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Looking at the state of the nation

More than ever, South Africa needs the president to deliver a State of the Nation Address that will offer optimism and hint at progress. Sabinet looks at what he might say.

Johannesburg, 12 Feb 2020
Read time 2min 40sec
Rosalind Hattingh, MD, Sabinet.
Rosalind Hattingh, MD, Sabinet.

There can be little doubt that 2020 has not begun on the most promising of notes – the economy continues to struggle, both the International Monetary Fund and the World Economic Forum have been sending the country ominous warning signals, and a ratings downgrade appears imminent.

For one thing, the IMF has lowered its growth forecasts for the country to just 0.8% from just over 1% last year, laying the blame on ‘structural constraints and deteriorating public finances’. Rosalind Hattingh, MD of Sabinet, points out that citizens seek assurance that things will improve, something that can only be provided once they can see decisive action being taken.

“With this in mind, what can we, or should we, expect from the forthcoming State of the Nation Address (SONA)?” she asks.

Scheduled for 13 February, the SONA – which essentially outlines government’s plans for the year – will be presented during the official opening of Parliament. With the current crises besetting the nation, it would be no understatement to suggest this will be the most critical SONA in the past decade or more.

“What we would certainly expect to hear from the president during his comprehensive analysis of the nation’s challenges during SONA is some answers to how he hopes to achieve the goals of ‘investment, jobs and inclusive growth’ as he set out in his 8 January statement,” continues Hattingh.

She adds that the most critical thing SONA must address is the situation at the power utility. After all, while Eskom remains unstable, the country and its economy will also remain unstable. Therefore, SONA should address how the Eskom conundrum will be solved, as it is all but impossible to significantly grow an economy without access to reliable and consistent power.

“Business will be looking to the president to announce programmes designed to reduce or eliminate obstacles to investment in each specific sector. This will allow investment to flow back into the economy and GDP, in turn stimulating economic growth and growing employment – both things the country desperately needs.”

It is quite clear, adds Hattingh, that tough decisions are required in order to turn the economy around. What SONA should do is to outline what steps are being taken, and when these will be implemented. In the end, SONA 2020 needs to not only focus on existing works-in-progress, but must also convey a coherent sense of economic direction.

“The president may also ask for much deeper collaboration between the private sector and government, as it will require a concerted effort on behalf of all key players to overcome the existing constraints on growth and reform.

“This SONA comes at a time when Moody’s Investors Service has a decision on our investment rating pending. The right messages sent by the president in his SONA address may go a long way towards averting a downgrade,” she concludes.

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