Zuma concedes economic crisis, fumbles for answers

South African President Jacob Zuma acknowledged the extent of South Africa’s economic crisis in his State of the Nation address on Thursday, but failed to flesh out the incisive turnaround strategy he said was needed to revive growth.

Neither could he silence his increasingly bold opposition critics. Zuma again endured the embarrassment of his speech being delayed by heckling from the Economic Freedom Fighters, while Democratic Alliance leader Mmusi Maimane declared after the address: “I dislike President Zuma. I want President Zuma to be removed.”

The president raised tackling racism as a policy objective before turning to the economy. He conceded that South Africa was at real risk of losing its investment grade credit rating, and that internal constraints, including unstable electricity supply, were contributing to the country’s bleak growth forecast.

“The lower economic growth outcomes and outlook suggest that revenue collection will be lower than previously expected,” Zuma said.

“Importantly, our country seems to be at risk of losing its investment grade status from ratings agencies. If that happens, it will become more expensive for us to borrow money from abroad to finance our programmes of building a better life for all, especially the poor.

“The situation requires an effective turnaround plan from us.”

He said a minimum wage should be implemented without causing job losses, and vowed to improve oversight over state-owned enterprises and streamline their mandates.

“We have to streamline and sharpen the mandates of the companies and ensure that where there are overlaps in the mandates, there is immediate rationalisation… Those companies that are no longer relevant to our development agenda will be phased out,” he added, but said many were doing a decent job.

“Eskom, in spite of the challenges, still manages to keep the economy going, against all odds.”

The president went on to outline a number of belt-tightening initiatives, taking particular aim at a variety of items, such as state-funded banquets and international travel junkets.

As of now, Zuma said, travel requests would need to be motivated properly and submissions would be interrogated fully.

Luxury catering for state functions would come to an end.

He also indicated that government would revive discussions about doing away with having separate legislative and administrative capitals as another attempt to tackle unnecessary spending.

He implored South Africans to take ownership of efforts to boost the economy, saying: “It is important to act decisively to remove domestic constraints to growth. We cannot change the global economic conditions, but we can do a lot to change the local conditions.”

After weeks in which the African National Congress (ANC) has suggested that mounting calls for Zuma to leave office were motivated by regressive racial politics, Zuma announced that March 21 – Human Rights Day – would see the start of a new programme to fight lingering racism.

“There is a need to confront the demon of racism,” he said as soon as he turned to policy matters in a speech delayed for an hour by opposition theatrics. The EFF were ordered out of the National Assembly by National Council of Provinces chairwoman Thandi Modise after party leader Julius Malema led his MPS in shouting “Zupta must fall”.

Less predictable was an interjection by Congress of the People (COPE) president Mosiuoa Lekota who rose on a point of order, then told MPs: “He broke his oath of office. He is no longer honourable. He is no longer fit to lead…”

Malema echoed this when he charged: “There is nothing that Zuma deserves from us. Zuma is no longer a president that deserves respect from any of us … he has made this country a joke.”

The EFF had sought to confront Zuma about his calamitous changing of finance ministers twice in four days in December.

Maimane said it was more important to ask Zuma to explain what he would do about the fact that 8.3 million South Africans did not have jobs, than why Nhlanhla Nene lost his. Commenting later, he termed the president’s address “more of the same”, saying the spending cuts he listed were far from bold enough and he had again failed to instill confidence.

(File photo: Getty Images)