Solly Phetoe. Picture: SOWETAN
Solly Phetoe. Picture: SOWETAN

Finance minister Tito Mboweni has hit back at ANC alliance partners for their criticism of his economic strategy paper aimed at pulling SA out of its economic quandary, saying it was not cast in stone.

This after the SACP and union federation Cosatu expressed their reservations about the document, saying it should be scrapped.

A former governor of the SA Reserve Bank and labour minister, Mboweni published the document on the Treasury website on Tuesday, and called on the public to make comments directly to the Treasury until September 15.

The economic strategy document made proposals about prioritising labour-intensive growth, creating export competitiveness, harnessing regional growth opportunities, and implementing focused industrial and trade policy to promote competitiveness and facilitate growth, among others.

The document comes as SA is grappling with low economic growth, with the GDP having shrunk 3.2%, or R56bn, in the first quarter of 2019. The unemployment rate has jumped from 27.6% to 29% in the second quarter. The Reserve Bank expected the economy to grow just 0.6% in 2019, after climbing to 0.8% in 2018.

The SA economy was also bogged down by requests for government bailouts from a number of cash-strapped state-owned enterprises including public broadcaster SABC, arms manufacturer Denel, power utility Eskom, and airline SA Express, among others.

SACP spokesperson Alex Mashilo said they were “deeply concerned” about the manner in which the economic strategy document came about. He said the document sought to negate some aspects of the ANC election manifesto for the May 8 vote, which the SACP had endorsed.

“The ANC manifesto asserts the national minimum wage and the necessity for a living wage; therefore, we cannot have a policy that reverses that,” said Mashilo on Thursday.

‘Undermining Nedlac’

In a media briefing on the outcomes of Cosatu's central executive committee meeting in Johannesburg on Thursday, the labour federation accused Mboweni of “undermining” the National Economic Development and Labour Council (Nedlac) processes in dealing with the paper.

Cosatu deputy general secretary Solly Phetoe said the paper sought to exploit SA's economic crisis by pushing what he described as a “right-wing agenda that was defeated in several ANC conferences”.

He said the document ventured into the domain of other departments and “at the same time it does not offer any proposed real changes to fiscal, monetary or other macroeconomic policy, including inflation targeting”.

The document made the government appear  incoherent, confused and unreliable, said Phetoe, adding: “Cosatu will continue to engage with any policy proposal at Nedlac but we reject this particular paper and demand that National Treasury withdraws this document immediately.”

Union federation Saftu general secretary Zwelinzima Vavi characterised the ambitions of the strategy as “frankly pathetic”, saying the document failed to mention austerity, monetary policy and labour market deregulation, among other hot-button issues.

"[The document] focuses mainly on microeconomic policy but the Treasury regards itself as the custodian of macroeconomic policy,” said Vavi.

“The urgent task remains to have a serious and inclusive national conversation about a bold, innovative, economic strategy which can move our country forward. The Treasury document is not a useful basis for this discussion.”

Mboweni told Business Day that for the past month he had been calling Cosatu general secretary Bheki Ntshalintshali in order to give him a copy of the document “but he's not responding to my messages”.

He said the SACP was being disingenuous over its concerns about the document, saying his cabinet colleagues and SACP leaders Blade Nzimande and Thulas Nxesi had “the document in their hands”.

Mboweni said he had asked all his cabinet colleagues to give him written commentary on the document and stressed that the document had not been finalised just yet. “We are saying let's discuss it [document]. If anyone has a view they must submit it to the minister of finance,” Mboweni said.

mkentanel@businesslive.co.za