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Reconstruction, Growth And Transformation: Building A New, Inclusive Economy

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Reconstruction, Growth And Transformation: Building A New, Inclusive Economy

Reconstruction, Growth And Transformation: Building A New, Inclusive Economy

10th July 2020

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The COVID-19 pandemic continues to impact negatively on economic activity in South Africa and around the world – unemployment is rising, businesses are under pressure and public finances are being stretched. South Africa’s legacy of underdevelopment and the country’s ongoing realities of poverty and racial and gender inequality are once again being exposed for all to see.

The Economic Transformation Committee (ETC) of the ANC has developed this framework for Reconstruction, Growth and Transformation, with the objective of building a new, inclusive economy.

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The first pillar of the new policy framework is to mobilise society around an infrastructure-led recovery with new investments in energy; water and sanitation; roads and bridges; human settlements, health and education; digital infrastructure and public transport. To achieve significant job creation multipliers, the emphasis will be on localisation, including maximising the use of South African materials and construction companies as well as labour-intensive methods.

While it is an urgent priority that state capacity to plan and monitor the execution of infrastructure projects should be strengthened, there will also need to be expanded use of public-private partnerships, including build, operate and transfer project delivery methods. The establishment of an infrastructure development agency in the Presidency will play a useful role in complementing the pockets of excellence that currently exist within the State and State Owned Companies with regard to project management capabilities.

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Further, the use of the District Development Model should be strengthened and deepened to improve service delivery and infrastructure expansion in both rural and urban areas. The State, through its various spheres and organs, should at all times function as a unit. It is through proper coordination and collaboration that service delivery will be improved and our people will begin to have better access to social and economic opportunities and choices. It is also crucial that South Africa forge new spatial forms in its settlement and transport systems, to bring people closer to areas of social and economic opportunity.

As a second pillar, the new policy framework will promote investment in key productive sectors, such as, agriculture, manufacturing, mining and tourism and other services. Decisive progress will be required in telecommunications reform, including expediting digital migration and spectrum allocation to reduce data costs for households and firms. Similarly, the growth and job creation potential of energy-related investments, including green industries must be fully harnessed including through local production linked to the country’s energy investment programme, as required in the Integrated Resource Plan. Industrialisation and the expansion of South Africa’s productive sectors will be accelerated though increased international trade, especially with other countries on the African continent.

While working to restore fiscal sustainability, South Africa needs to deploy macro-economic policy instruments that are compatible with the reconstruction of our economy. Reconstruction programmes must be sufficiently financed and financially sustainable. The National Treasury, South African Reserve Bank, development finance institutions (DFIs) and private financial institutions all have a role to play. The mobilisation of funds for increased investment in infrastructure and key productive sectors will inevitably require a combination of public and private resources.

Report by the ANC

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