President Cyril Ramaphosa’s signature initiative to kickstart economic growth is a drive to attract investment of $100bn (R1.4-trillion) over the next five years. However, the initiative is a nonstarter as long as a crippling public-sector investment strike continues. Contrary to popular perceptions, the public sector (and not the private sector) is the major reason for the decline in gross fixed capital formation since 2015. The steep decline in public investment has contributed towards a collapse in the country’s trend growth rate to about 1% over the past four years. The time has come for the president to implement a R500bn fiscal stimulus, equivalent to about 3% GDP a year for the next three years, to turn the economy around. There have been three phases of economic policy since the advent of democracy. During the first period, from 1996 to 2002, slash-and-burn monetary and fiscal policies after the implementation of the growth, employment and redistribution policy resulted in s...

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