President Cyril Ramaphosa failed to deliver on many promises he made in 2023’s State of the Nation Address (SONA), and South Africans should expect the same from his 2024 address.
This is the view of Efficient Group chief economist Dawie Roodt, who told RSG that 2024 – being an election year – will influence the President’s priorities in his address.
Ramaphosa will prioritise politics over economics, which is what the country needs more, Roodt said.
For example, the President will likely speak about the Springboks and Bafana Bafana’s victories and make populist promises like a Basic Income Grant.
There is also a possibility that the President could declare a state of emergency around Transnet and the logistics issues its failures have caused.
Roodt said he wants to see Ramaphosa address South Africa’s three biggest problems – dysfunctional municipalities, failing state-owned enterprises (SOEs), and the country’s fiscal deterioration.
Roodt listed all the promises the President made in his 2023 SONA and discussed whether any progress was made on these issues.
In his 2023 address, Ramaphosa said, “Our most immediate priority is to restore energy security.”
To address the issue, he appointed Electricity Minister Kgosientsho Ramokgopa and committed to revitalising Eskom’s coal-fired power stations.
However, in 2023, load-shedding continued unabated, and South Africa experienced its worst year of power cuts yet.
This not only saw the country experience 335 days of load-shedding but also had a significant impact on the economy.
This energy disaster has continued into 2024, with 23 days of load-shedding this year so far.
Infrastructure and logistics
Alongside the country’s energy crisis, South Africa’s state-owned logistics company, Transnet, also fell into a crisis in 2023, resulting in massive losses for the economy.
In his 2023 SONA, Rampahosa said the government is working to develop a Transnet Roadmap that will translate its policy commitments into reality.
This includes the restructuring of Transnet Freight Rail to create a separate Infrastructure Manager for the rail network by October 2023.
However, this did not happen, and Transnet’s collapse only worsened in 2023.
The gravity of the problem with this SOE was put on display in November 2023 when a maritime gridlock at South Africa’s ports kept nearly 100 vessels waiting to dock.
However, Roodt said the President did fulfil his promise of migrating the remaining households in South Africa to digital television signal and completing the switch-off of analogue transmission.
In 2023, the President reiterated his promise to reduce red tape “so that we can rid our country of the unnecessary bureaucracy that often holds us back”.
To achieve this, the President created a red tape reduction team in the Presidency under Sipho Nkosi.
Roodt said he has yet to see this have any effect on the red tape in government organisations and processes.
Several business leaders have had similar complaints.
In September 2023, DRDGOLD CEO Niël Pretorius added his voice to the chorus of business leaders, saying that South Africa’s regulatory environment is too burdensome for companies and prevents investment in the country.
Pretorius told BusinessTimes that applying for water licences “is like setting fire to tax”, as the gold producer took a R300 million hit from administrative delays.
“If you look at it in isolation, there is R300 million worth of revenue lost to this economy, of which a significant proportion would have been income tax. It is like setting fire to tax.”
The President said the government will protect the poor by increasing social grants and expediting the provision of title deeds for subsidised houses.
However, Roodt said this did not help relieve poverty in 2023, as the country became poorer per capita.
The World Economic Forum (WEF) recently revealed in its Future of Growth report that South Africans are getting poorer as the country’s population continues to grow while its economy stagnates, meaning there is less money to go around.
The report showed that South Africa’s economy is not competitive on the global stage, as it is below average on three of the four key indicators that the WEF considers vital to economic prosperity.
The country did not fare well on traditional indicators of economic prosperity, such as economic growth, GDP per capita growth, government debt, and life expectancy.
All of these indicators have deteriorated, with South Africa’s economy stagnating while its government debt has skyrocketed and population boomed.
Of particular concern is how the country’s economic growth has failed to keep up with its population, making South Africans poorer.
Stronger police force
Ramaphosa said the government is strengthening the South African Police Service (SAPS) to prevent crime and improving the capacity of the National Prosecuting Authority and courts to ensure perpetrators are brought to justice.
“This includes putting more police on the streets and setting up specialised teams that will focus on specific types of crime,” he said.
However, in 2023, it was revealed that South Africa has less than 18,000 detectives across the country, as the SAPS has lost over 8,000 detectives since 2017.
It was revealed in Parliament that South Africa’s detectives have declined from around 26,000 in 2016 down to 17,600 in 2023.
DA MP Andrew Whitfield said this crisis must be urgently addressed, as detectives are critical for an effective justice system.
“We have a crisis in SAPS, and the implications of that crisis for the Police Service and the South African public, more importantly, cannot be underestimated,” he said.
“Our detectives are some of our most highly skilled police officers who are required to ensure that investigations are conducted properly, effectively, and efficiently.”
In 2022, Ramaphosa said the government would take decisive action against corruption and make a clear break with the era of state capture.
“The State Capture Commission headed by Chief Justice Raymond Zondo completed its work and submitted the final part of its report in June last year,” the President said in 2022.
“As a country, we owe Chief Justice Zondo, the Commission staff and all those who provided testimony a huge debt of gratitude for their extraordinary public service.”
He said the recommendations of the Commission are being implemented according to the plan that he submitted to Parliament in October 2022 so that the systemic weaknesses identified by the Commission are addressed and state capture is never allowed to occur again.
While some progress has been made, Roodt said it is not nearly enough.
Daily Investor found that most of the politicians implicated in the Zondo Commission’s findings have not been prosecuted, and many are still in government positions.
Africa Free Trade Agreement
“South Africa, together with our neighbours in the Southern African Customs Union, will soon finalise our industrial offer on the African Continental Free Trade Area,” the President said in 2023.
This was a promise Ramaphosa followed through on, Roodt said, as the African Continental Free Trade Area is working well.