President Cyril Ramaphosa has addressed Parliament this afternoon, to outline the country’s much-anticipated Economic Recovery Plan. The President last week wrote to National Assembly Speaker Thandi Modise and National Council of Provinces (NCOP) Chairperson Amos Masondo about his intention to call a joint sitting of the two Houses of Parliament.
Economic Recovery Plan: President unveils 14 key interventions
On Thursday, he delivered the goods. Ramaphosa outlined a range of measures to tackle the debilitating effects of the COVID-19 pandemic, and how it has deeply affected the pockets of millions of South Africans.
The Economic Recovery Plan identifies roles and responsibilities of all the social partners – government, community, labour and business – who declared their commitment to the implementation of the plan.
“We need to take extraordinary measures towards a speedy and sustainable economic recovery,” President Ramaphosa told the National Assembly earlier on Thursday. South Africa’s economy contracted by a staggering 51% in Q2 of 2020.
The period coincided with the hardest levels of the country’s lockdown, as the government limited movement and economic activity in an attempt to curb the spread of Coronavirus.
Last week’s Cabinet Lekgotla focused on coming up with a reconstruction and recovery plan, pinpointing infrastructure, job creation, and industrialisation. Indeed, the president made it clear that there is a huge rebuilding job underway:
Economic Recovery Plan: Where – and how – will Ramaphosa spend the money?
- Ramaphosa has vowed to create 800 000 work opportunities in the next few years, using a R1 billion war-chest.
- The new jobs blitz includes 60 000 new positions in construction. More than 6 000 jobs will be created for community health workers and nursing assistants – furthermore, 40 000 teaching posts are being secured as part of the project.
- Ramaphosa revealed that the government will create 300 000 opportunities for young people to work as education and school assistants, helping teachers with basic schoolwork.
- There will be R1 trillion invested in infrastructure over the next four years.
- By June 2020, there were 276 infrastructure projects that are under development. The ‘catalytic’ measures will enable an investment of R340 billion in the short-term.
- This Economic Recovery Plan will, apparently, bring our economic growth up by 3% per annum in the next 10 years.
- R130 billion has been earmarked to be used for a number of housing projects across the country which will see the creation of 190 000 housing units.
- Highways, rail, and major roads – include the N1 Polokwane and N1 Musina – will undergo a R1.3 billion modernisation upgrade.
- SA is looking to increase our renewable energy capacity, and this should add 11 800 MW to our electricity system.
- Ramaphosa aims to connect an extra 2 000 MW to the grid by June 2021 – another 2 000MW of emergency supply will be added in 12 months.
- The R350 grant for SRD payments will now be extended for three more months.
- Social partners have agreed to support a massive buy local campaign, partially small, township, and women-owned businesses. The target is 40% of procurement spent on such companies.
- Ramaphosa also highlighted ‘five illicit tax markets‘ he wants to shut down, including Transfer pricing abuse, profit shifting, VAT and customs duty fraud, under-invoicing of manufactured imports, corruption – and other illegal schemes.
- Although no numbers were provided, broadband access will be extended to low-income households, and data prices will be slashed.