The South African Institute of Race Relations (IRR) on Tuesday claimed that the African National Congress’s (ANC’s) “sleep start” ahead of the local government elections, will leave South Africans poorer and weaken social cohesion.

Releasing its latest Blueprint for Growth paper, IRR CEO Dr John Endres said economic growth was anaemic, and the country had been stuck in a low-growth rut for over a decade.

He noted that despite some improvements in sentiment, since the formation of the Government of National Unity (GNU), South Africa remained in “serious economic trouble”.

He highlighted that public debt was “mountainous”, despite National Treasury “struggling valiantly” to stop it from rising.

“Fixed investment, an important driver of economic growth, has seen a substantial downturn, with total real investment declining by almost 15% from R775-billion in 2008 to R661.1-billion in 2024,” he stated.

He highlighted that the ANC was initially shaken by the election outcome in May 2024, but claimed that it had been acting with growing assurance in pursuing its original policy thrust, inspired by the ideology of the National Democratic Revolution (NDR).

“It has been at pains to emphasise – in the ANC president’s January 8th statement in 2025 – that cooperating with the other GNU parties is merely a tactical move, a marriage of convenience, not conviction. He [Cyril Ramaphosa] repeated his party’s commitment to the NDR in the 2026 January 8th statement."

Endres noted objections from coalition partners around the Basic Education Laws Amendment Act and the National Health Insurance, which he said were brushed aside.

He said Trade, Industry and Competition Minister Parks Tau had “provoked vociferous opposition” in proposing to set up a “racialised” Transformation Fund worth R100-billion, to which businesses were supposed to make significant contributions.

Further, Ramaphosa signed into law the Expropriation Bill, which Endres described as an anti-investment and anti-growth piece of legislation.

“While ANC leaders have paid lip service to the importance of economic growth, this has not been matched by action. They appear content to aim for low growth rates, which are to be achieved through limited and slow-moving reforms in infrastructure, especially.

“There is no turning away from the party’s fundamental precepts, which are inspired by notions of redistribution, centralisation, State intervention in the economy, and clientelist politics,” he stated.

Endres pointed out that these policy choices were “eroding confidence, deterring investment, and discouraging entrepreneurship”.

“High taxes and excessive regulation, as part of government’s focus on wealth redistribution instead of wealth creation, have entrenched reliance on government benevolence,” he said.

Under current conditions, growth would remain low, unemployment would continue rising, and South Africans would continue to be deprived of the opportunity to create a better life for themselves and their families, he warned.

“…changing this requires the government to adopt a single-minded focus on achieving much higher growth rates, without which the many ills plaguing the country cannot be ameliorated,” he added.

He called for the urgent expansion of capital inflows and foreign direct investment (FDI) into South Africa, to start raising the growth rate and increasing fixed capital formation.

Endres averred that a new approach with sound policies and a commitment to clean and efficient governance was urgently required to trigger economic growth and turn the country around.

He said South Africa must build and maintain essential economic and social infrastructure to stimulate growth and provide a solid foundation for further economic expansion.

Endres said government must also translate increased growth into increased employment, while helping the disadvantaged climb the economic ladder to increase prosperity.

“If implemented, these proposals will give South Africans a realistic chance to get ahead based on greatly increased employment, effective socioeconomic empowerment, and a sustainable safety net that helps integrate even the poorest into an innovative and expanding economy,” he said.

He noted that such a proposal entailed removing barriers to economic activity and devolving decision-making to the individual South Africans who had the most to gain or lose from helpful or harmful policies.

Endres stated that IRR’s plan was based on the ideas of decentralisation, freedom of the individual, and increased production rather than redistribution.

“…in this spirit, it calls for property rights to be respected, race-based policies to be replaced, and markets (especially the labour market) to be deregulated. This will improve economic freedom and allow the State to refocus its energies onto a limited mandate that it can execute competently,” he explained.