Responses to president Cyril Ramaphosa’s eighth State of the Nation Address (SONA) have been coming in hard and fast, with a common theme in the analysis being that the president missed the mark by playing politics instead of dealing with the country’s critical issues.
Leading up to the SONA, businesses groups implored the president to steer clear of electioneering and instead focus on providing a frank overview of South Africa’s many crises and how the government and the private sector were working together to resolve them.
Economists and analysts were looking for certainties and plans of action to boost investor confidence and grow the economy – while cities and other political leaders were hoping for the president to acknowledge critical issues like crime, infrastructure and education.
While the president touched on some of these topics in his almost two-hour speech, they were almost entirely framed in government successes and not-so-subtle electioneering for the ANC – or so vaguely presented that there was little to glean from it.
The overall sentiment coming from commentators is that the speech was wholly too self-congratulatory, singing the praises of the ANC government and what it has done while virtually ignoring its culpability in South Africa’s many crises and being scant on details of how to navigate its way to recovery.
However, not all reactions were overtly negative. Some commentators appreciated that the president at least acknowledged some of South Africa’s problems. Others were more neutral on the speech, having had low expectations to begin with.
Below are some of the main reactions to the speech.
Something positive to say
Business Leadership South Africa (BLSA) said that it was positive that the president at least acknowledged the work being done by the private sector in partnership with the government to address South Africa’s power and logistics crises – and that economic growth was a key target.
BLSA CEO Busi Mavuso said it was also important to note what was not said by the president.
“There were no populist promises on the social relief distress grant that would come at the cost of government’s fiscal discipline,” she said.
“There are obvious political pressures to make unsustainable commitments to spending, but the President stopped short of major new promises. That is an implicit endorsement of National Treasury’s fiscal discipline, which is key to business confidence,” she said.
However, the Mavuso noted that the speech was scant on any actual details, without any clear plans or ideas on how to get rid of the many blockages within the government preventing speedier resolutions to problems.
Pretty much as expected
Economists at the Bureau for Economic Research (BER) said that the speech was in line with what they expected, noting that the SONA was always going to be more political and trying to appeal to voters.
To this end, the BER appreciated that the speech at least did not include references to smart cities or other pie-in-the-sky projects (aside, maybe, from high-speed trains), being somewhat more relatable to many South African citizens.
The group said that the mention of extending the SRD grant and laying down the foundation for a more permanent basic income grant is seen as positive, but questions still hang around about how this will be funded over the long term.
In the same vein, the mention that the National Health Insurance (NHI) would be implemented incrementally is also likely to be welcomed, if that means slow and steady instead of in one big shock to the system.
“Again, it also comes back to the affordability and, in this instance, the capability. Better outcomes are more likely with a slower approach, allowing the government to address issues of concern (for example, the number of healthcare workers),” the BER said.
“As always, the focus of the lengthy SONA was on accomplishments, including those on the sports field and cultural front by SA citizens, and broad policy priorities going forward. The important (funding) details and arguably even more important implementation plans are largely left to the Budget and respective ministers.”
Missed the mark
Analysts were not as kind to the speech, with Nkosinathi Mahlangu, Youth Employment Portfolio Head at Momentum Metropolitan and Jurgen Eckmann, Franchise Principal and Financial Adviser at Consult by Momentum both saying the president missed the mark on key issues.
On employment – and youth employment in particular – while the president acknowledged the problems, he provided little in the way of solutions.
“There were not many tangibles – vague references to employment opportunities, but there is a big difference between job opportunities and actual jobs,” Mahlangu said. “It’s important to be optimistic, but we also need to be realistic. Youth unemployment remains a massive challenge.”
For Eckmann, the speech didn’t do much to help those concerned about the economy to find something to latch onto.
“Unfortunately corruption, high unemployment, poor service delivery, high crime rates – these are all correlated and affect our economic growth. These were areas I wanted clarity on, but unfortunately, the address was a bit vague on details,” he said.
“The president touched on involving the private sector in growth initiatives, which will lead to expansionary fiscal policy – but we needed more clarity. We’ve been stuck in a sluggish growth environment of 1-2% for some time now, and the economy needs to grow more so that we can pull in foreign direct investment.”
On the opposite end of the spectrum, opposition parties and civil action groups found the SONA to be a complete flub.
While Ramaphosa’s political opponents were never going to cheer his address, groups like OUTA anticipated nothing from the speech to begin with, opting to “disengage” from what it believed would be a purely political agenda-pushing session.
Unions, like Solidarity and its associated groups, were also scathing in their reviews, calling the speech “malicious dishonesty with the aim of misleading voters before the election”.
Notably, some private companies were also on this end of the reaction spectrum, with Lew Geffen Sotheby’s International Realty CEO Yael Geffen likening the president to the Roman emperor Nero “playing his fiddle as he watched Rome burn”.
“It’s absolutely astonishing that President Cyril Ramaphosa had the gall to once again stand in front of the nation for this annual speech and repeat the mantra that boils down to ‘yay for the government; we’ve not only delivering more than ever before, but we have a fantastic plan to fix what everyone else has broken’,” she said.
“This, when the interest rate remains at its highest point in 14 years, food inflation is out of control, electricity and fuel costs are crippling consumers, and household debt is spiralling.”
Geffen said this year’s SONA – with its excess of promises and shortage of tangible solutions – reinforces the fact that South Africa’s economic salvation lies in the hands of its people.
“The president was right in saying that we should remember that it’s up to us – not anyone else – to determine the future of South Africa. I say, challenge accepted.”