28 August 2019
National treasury has released an economic policy paper for comment.
According to a statement, the paper is entitled “Economic Transformation, Inclusive Growth, and Competitiveness: Towards an Economic Strategy for South Africa”.
The policy paper is an “attempt to translate the broad outcomes of inclusive growth, economic transformation, and competitiveness into specific programmes and draw on a range of domestic and international literature to support these policy priorities”.
It focuses on specific growth reforms that can result in economic transformation, inclusive growth, and competitiveness.
“This paper is a detailed examination of the structural reforms that can reverse the downward trend in South Africa’s growth potential and competitiveness.”
Six themes, flowing from the National Development Plan, are outlined in the paper including modernizing network industries to promote competitiveness and inclusive growth; lowering barriers to entry and addressing distorted patterns of ownership through increased competition and small business growth; prioritizing labour-intensive growth: agriculture and services; implementing focused and flexible industrial and trade policy to promote competitiveness and facilitate long-term growth; promoting export competitiveness and harnessing regional growth opportunities and quantifying the impact of proposed growth reforms.
The policy paper confirms that South Africa’s current economic trajectory is unsustainable as economic growth has stagnated, unemployment is rising, and inequality remains high.
“The government should urgently implement a series of reforms that can boost South Africa’s growth in the short term, while also creating the conditions for higher long-term sustainable growth.”
According to the executive summary, the only way to raise South Africa’s potential growth is by implementing a “series of deliberate and concerted actions across a range of fronts”.
Comment is invited until 15 September 2019.