President Jacob Zuma\u2019s State of the Nation speech was filled with old ideas, according to Nomura emerging markets economist Peter Attard Montalto on Thursday.<\/p>\n
The removal of two centres of government has been considered since 1994, but never happened, said Montalto.<\/p>\n
\u201cIt would save around R500m to 750m per year, but that would be offset by the likely massive cost of building a new parliament in Pretoria,\u201d he said. \u201cIt would also take five to 10 years likely for net savings to be achieved.\u201d<\/p>\n
There was no mention of wealth tax, confirming to it won\u2019t appear in the budget, he said.<\/p>\n
The ban on foreign land ownership and a bill to this effect were mentioned, which will come forward in the second quarter of 2016 and will be \u201cdeeply non-investor-friendly\u201d, said Montalto.<\/p>\n
\u201cWe were a little surprised that the ban on foreign land ownership was given such prominence, and whilst leasing will be possible, this is a classic example of a policy going in the wrong direction to helping growth,\u201d he said.<\/p>\n
There was a lot of mention of historic redress and the need for \u201cradical economic transformation\u201d, said Montalto. This \u201cis not a ratings-friendly phrase\u201d.<\/p>\n
\u201cThis was tempered by an interesting first; an admission of the need for private enterprises to make profit,\u201d he said.<\/p>\n
Regarding parastatals, there was no mention of putting private sector management in place, which was a key suggestion from recent CEO meetings with Zuma.<\/p>\n
\u201cThere was no mention of privatisation, though \u2018defunked\u2019 parastatals would be closed, but we think this is not a new policy.\u201d<\/p>\n
Most concerning of all, was that there was a very \u201cconspicuous absence of any mention of tackling corruption, which was very odd\u201d, said Montalto. \u201cIt has always been mentioned in previous speeches.\u201d<\/p>\n
Montalto said the \u201cnew\u201d one-stop shop for investments and an inter-ministerial investment promotion committee were mentioned, but these are not new policies.<\/p>\n
\u201cEqually, the need to remove regulatory blockages was mentioned, but no specifics of blockages to be dealt with were given.\u201d<\/p>\n
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