The next phase of South Africa’s response to the coronavirus: Ramaphosa

President Cyril Ramaphosa said that South Africa is facing the ‘next phase’ of its fight with the coronavirus which will focus on the recovery of the economy.

Responding to questions in a virtual parliament on Thursday (18 June), Ramaphosa said that this will include a comprehensive economic strategy that will be aimed at driving the recovery of the economy as the country emerges from the pandemic.

“Given the massive impact that the coronavirus is having on jobs, our immediate priority is creating employment. I have often said that the post-Covid-19 economic landscape is similar to a post-war landscape.

“We have to do the extraordinary. We will do this by embarking on a number of initiatives including expanding public employment, increasing investment in public infrastructure and enabling greater job creation in the private sector.”

Ramaphosa noted that the presidency will hold a sustainable symposium next week to discuss infrastructure funding which will help create jobs in the country.

Government has told asset managers and banks it needs R1.5 trillion of infrastructure investment over the next decade.

At a meeting at the end of last month the infrastructure commission in President Cyril Ramaphosa’s office presented projects ranging from water and sanitation to energy and digital infrastructure, said Jason Lightfoot, a portfolio manager at Futuregrowth Asset Management, which oversees about R194 billion.

The presentation was a precursor to a formal announcement of the projects by Ramaphosa on June 23, when he will launch the biggest drive to date to attract private investment into infrastructure.

Policy changes

Ramaphosa said that South Africa will need to ‘reset nearly everything’ as it gears up for its post-Covid recovery.

“We need to look at the policies we have embarked upon in the past and see if they are still fit for purpose post-Covid-19.

“We need to reset the structure of our economy and look at the ways we have always done things.”

The president added that while Covid-19 can be seen as a ‘dark cloud that it hanging over us’, it does have a silver lining in that it gives the government an opportunity to change things.

The president confirmed that this will include a move to a zero-based budget process, in line with recent comments made by finance minister Tito Mboweni.

Nazmeera Moola, economist at from Ninety One, explained that zero-based budgeting begins at a base of zero, thereby not taking into account any leftover spending from prior periods.

Budgeting essentially starts from a zero base and every function within an organisation is analysed for its needs and costs.

“Personally, I think it sounds better in theory than it does in practice,” Moola warned on BusinessDay. She said that the finance minister will likely try to achieve a comprehensive assessment of what expenditure is taking place and whether we need to re-prioritise, or redirect expenditure, given the pressure that Covid-19 is putting on revenues.

“That’s a fantastic idea,” Moolsa said, but noted that if what the minister is talking about is for every department to justify their expenditure from zero-up, “that’s a massive exercise that quite frankly we don’t have the time or man power to execute.”

As a further example of the opportunities available in South Africa right now, Ramaphosa said that local businesses now have the ability to manufacture masks and other needed goods.

“Our third phase must build an inclusive economy, that builds jobs, brings young people in and pushes the agenda of the fourth industrial revolution.

“We need to bring in the private sector to invest in the economy while also strengthening the public sector We will go through a slump as Covid-19 will still have its effect, but we will move on with the rebuilding process.”


Ramaphosa acknowledged that corruption remains a ‘major challenge’ in South Africa, and he noted that the country will need to put in place ‘proactive mechanisms’ around the country’s R500 billion stimulus plan.

Ramaphosa added that the auditor-general is working on a number of regulations to prevent this money from being looted.

He also raised concerns about issues such as food parcels which have been unlawfully ‘redirected’.

“We want to ensure that the money that has been set aside for Covid relief is responsibly used and is used for what it is intended for.”

Read: The difficult coronavirus problem South Africa is facing right now: Mkhize

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The next phase of South Africa’s response to the coronavirus: Ramaphosa