Thabo Mbeki

Presidents past and present. SA’s former president Thabo Mbeki (l) in conversation with current head-of-state Cyril Ramaphosa (r). Image:Twitter@thepresidency

Ramaphosa vague on where the funds will come for his recovery plan – Mbeki

South Africa’s former president, Thabo Mbeki, proposed that government should clearly indicate the public and private sectors’ respective capital contributions to the RRP’s programmes.

Thabo Mbeki

Presidents past and present. SA’s former president Thabo Mbeki (l) in conversation with current head-of-state Cyril Ramaphosa (r). Image:Twitter@thepresidency

Former President Thabo Mbeki says President Cyril Ramaphosa’s Economic Reconstruction and Recovery Plan (RRR) will remain “a mere vision” until the government finds resources to implement it, while emphasising that it’s important for the president to explain where the money to fund the recovery effort will be coming from.

Responding to Ramaphosa’s Reconstruction and Recovery Plan (RRP) address in Parliament last month, Mbeki said in his Thabo Mbeki Foundation newsletter published this week, that the president’s address has “naturally” thrown up up questions.

“Did the President’s Address communicate a message of “a rupture with the past; and, did the President’s Address communicate a message of “fundamental and lasting change”?

‘Govt must indicate capital availability’

Mbeki said the programmes contained in the RRP and Presidential Address will remain a mere vision until the resources are made available to enable their implementation.

“This is why it is imperative that the government publishes another document which gives a realistic and credible indication of the capital that is and/or will be available to fund the RRP.”

Mbeki appeared to suggest that Ramaphosa’s address lacked detail on several aspects of the RRP, including specific timeframes and capital sources.

He said Ramaphosa further said that “the Infrastructure Fund will provide R100 billion in catalytic finance over the next decade, leveraging as much as R1 trillion in new investment for strategic infrastructure projects.

“This suggests that the only thing that is certain about the funding of the infrastructure rollout for the period up to 2030 is that at least R10 billion will be spent annually. Obviously this would not be enough to bring about the major socioeconomic changes visualised by the President.

Mbeki went on to say that through Ramaphosa’s mention of credit enhancement, the President communicated the message that at least some of the infrastructure rollout will be financed through money borrowed in the financial markets.

“The President did not explain how much of the projected infrastructure-spend would be borrowed money.”

Mbeki wants government to clearly outline the public and private sectors’ respective capital contributions to the RRP’s programmes.

The former president pointed out that how much of this capital would come from the private sector. is important because South Africa “suffers and will continue to suffer” from serious fiscal constraints;

“The cost of borrowing will be quite high, given the already existing sovereign rating downgrades and serious uncertainties about the future.”

Employment stimulus

The former President nevertheless voiced support for Ramaphosa’s Presidential Employment Stimulus, saying it will help reduce the “dependency syndrome.”

“It is clearly very good that the employment stimulus will go some way towards ensuring that in return for receiving social grants, all citizens contribute something towards the public good. This will help to confront the negative phenomenon of the dependency syndrome and enhance the active involvement of the citizen in the process of the building of the new South Africa everybody wants.”

Mbeki argued that significant sections of capital have been sceptical about South Africa’s future since 1994 and have therefore held back from fully investing in the economy.

“It is obvious that the implementation of RRP cannot be left to the market. For it to succeed requires the existence of the necessary institutional mechanisms,” he added.


The former president also pointed out that “during the last decade, many state institutions were systematically gutted and seriously weakened.” They were also compromised by the “virtual entrenchment of a culture of corruption.”

Mbeki also called on the social partners at NEDLAC to publish a document that explains their social compact, particularly the respective contributions of government, business, labour and civil society.

“It is of the greatest importance that especially the Government takes fully on board and acts on the understanding that everything must be done: to keep the population fully informed about what is happening with regard to the implementation of the RRP and related programmes; and, to use this to mobilise this population to be active participant and/or supporters of these programmes,” Mbeki said.


Referring to the president’s remarks that Government will be promoting “greater private sector participation in rail,” Mbeki said Ramaphosa will have to explain what is visualised in the statement, as, according to Mbeki, this suggests some form of privatisation.

“This would also give the Government the opportunity to explain whether the RRP visualises any privatisation, nationalisation and creation of new State corporations.”

He concluded by saying that precisely because of the importance of the social compact agreed at NEDLAC to the success of the post-Covid-19 reconstruction, development and transformation of our country, the Government must work with its social partners to develop a document which “explains in a meaningful way, concerning such reconstruction, development and transformation” and the respective role of government, business and labour.