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BUSA commends President Cyril Ramaphosa for delivering a State of the Nation Address (SONA) that reaffirms and reinvigorates the government’s commitment to the reform agenda spearheaded by Operation Vulindlela and supported by business. It also highlighted the urgent need to prioritise the water crisis, address the dysfunctionality of municipalities, and to facilitate private sector investment in infrastructure. All of these measures are needed to raise economic growth above the – necessarily – ambitious target of 3%. With all the global uncertainty at present, we must ensure our economy is resilient and well-structured at home. 

The recognition of the importance of economic growth and the private sector, and the ambition to raise GDP growth above 3%, is refreshing, as is the importance of greening our growth. Also important is the strengthening of existing trade relationships and the full implementation of the African Continental Free Trade Area. The business community has frequently advocated for greater alignment between foreign policy and domestic policy interests to enhance the economic well-being of our country – with growth and jobs central.

The proposal to revitalise our industrial policy is also an important consideration, but it must represent a break from the past and accord with the broader sentiments of this SONA. With a more uncertain world in which South African business operates and competes, the President’s rallying cry for the constitutional and human rights foundations of our country and our global posture is important and welcomed.

The success of the reforms and partnerships, which have opened energy, freight rail, and ports to private sector participation, demonstrates the vital role business can play in addressing the country’s most pressing challenges—provided the right conditions are established. While reforms are advancing, the SONA made it clear that we must keep the end goal in mind as we progress through complex change.

The renewed commitment to provide “digital public infrastructure to give South Africans access to government services” and the “implementation of the digital identity system” is long overdue. Evidence from other countries clearly demonstrates that digital identity systems enhance economic inclusion. The adoption of appropriate digital technologies is essential for improving service delivery to businesses and citizens and closing loopholes that facilitate corruption.

While the speech did not introduce many new ideas, it served an important purpose by reassuring the public that successful government programmes will continue under the new administration. It was also useful to remind the country that a huge amount of change is being effected, even if there is frustration at the pace. A vital policy shift is the redesign of housing subsidies and directing more funding towards programmes that enable people to purchase or rent homes in areas of their choice, alongside the release of more underutilised state properties for affordable housing. This will unlock private investment in affordable housing, revitalise our cities, and reduce barriers to entry into the labour market.

It was also important for the President to remind the nation of the importance of tackling youth unemployment, one of the biggest risks to the country’s social and political stability. He highlighted several initiatives and partnerships between the presidency, business, and civil society to help young people overcome the challenges they face when entering the labour market.

While partnerships are crucial, they cannot substitute for the development of effective state capacity. We believe the measures announced by the President, such as establishing a graduate recruitment programme and strengthening the role of the Public Service Commission in the appointment of senior personnel, are essential building blocks for a capable public service. However, much more needs to be done; otherwise, the vision of this SONA will remain out of reach.

The President echoed his phrase from his post-election Opening of Parliament Address—we must be a nation of builders. There is certainly much building to be done, and business is ready to take up this call in its own sectors and in partnership with the government.

Issued by Business Unity SA CEO Khulekani Mathe