DAVID MAYNIER: Western Cape better on all metrics than national government
The Western Cape government has worked hard to create an enabling environment for the private sector and to drive economic growth
The veneer of President Cyril Ramaphosa as the “master negotiator”, who plays the long game and has everything under control, has been shattered in SA.
When faced with tough decisions, Ramaphosa is inclined to negotiate, prevaricate and equivocate, by calling summits, conferences and dialogues.
Rather than clear and decisive leadership, there is a sense of paralysis, which has resulted in a descent into economic madness, with national government considering reckless economic policy proposals, including land expropriation without compensation, state-owned banks, prescribed assets, and the nationalisation of the Reserve Bank.
The full horror of the national government’s mismanagement of the economy, our public finances and state-owned enterprises (SOEs) will have major implications for the economy in the Western Cape. The extent of this was made evident with the publishing of the annual provincial economic review and overview, and the municipal economic review and overview, by the Western Cape treasury.
These world-class documents contain forecasts of future trends and analysis of past trends, and serve as a “one-stop research shop” to support the policy, planning and budgeting process at provincial and municipal level in the Western Cape.
These reviews tell us a story of a slow recovery in economic growth, driven by private services in the Western Cape; a rebound in employment in the province; improved human development; and new and exciting opportunities in the Western Cape economy.
However, the fact is also that while the provincial economy is expected to grow at an average of 1.6% per annum over the next five years, this is lower than the average growth of 1.7% in the five years between 2013 and 2017, which included the meltdown of the global economy. Although the provincial business confidence index is higher than the national business confidence index, the national business confidence index has collapsed and is at a 20-year low.
In addition, although the provincial economy increased employment at a faster annual average growth rate than the national economy, there are still too many people who do not have jobs, or who have given up looking for jobs, in the Western Cape.
The downside risks to the provincial economy are considerable and include slowing global economic growth as a result of trade wars, and international political developments such as a possible no-deal Brexit. And the reality is that the national economy and provincial economy are linked and, for that reason, the biggest risk to the provincial economic outlook is SA’s national government.
The Western Cape government has worked hard to create an enabling environment for the private sector and for the markets, to drive economic growth and job creation in the province.
We cannot, and will not, sit back and allow national government to become a ball and chain holding back the economy. Premier Alan Winde has set out a bold vision and is implementing it. He has announced the most comprehensive and expensive safety plan in the history of the Western Cape, as well as the establishment of an “economic war room” to promote economic growth in the province.
In addition, the Western Cape government continues to implement existing programmes to drive economic growth and job creation, including red-tape reduction, air access, and investment and export promotion.
We will work hard to ensure that the provincial economy grows at a faster rate than the national economy; provincial business confidence continues to be greater than national business confidence; and that provincial employment continues to grow at a faster rate than the national economy.
We will do this so that more people, especially young people, have jobs and can live with dignity, independence and hope in the Western Cape.
• Maynier is Western Cape finance and economic opportunities MEC.