The chair of the ANC’s subcommittee on economic transformation, Enoch Godongwana, says the ruling party is yet to understand the full implications of junk status.<\/p>\n
Ratings agencies Fitch and Standard & Poor’s in the past two weeks both downgraded South Africa to junk status.<\/p>\n
Godongwana said people in South Africa had never known junk status before. The only time the country had come close to it, was in 1985.<\/p>\n
Godongwana was speaking at a media briefing where some of the ANC’s policy documents ahead of the party’s policy conference in June were discussed. He hit out at those who said they welcomed the country’s downgrade to junk status.<\/p>\n
He said there can be no radical transformation in the face of a possible recession.<\/p>\n
\u201cRecession means the economy is not growing, it’s contracting. If it happens in the context of 27% unemployment, you will be adding more people to the pool of unemployment and be excluding more people from the income stream so that can\u2019t be an inclusive growth,\u201d Godongwana said.<\/p>\n
He said there was a need to engage those who had welcomed a ratings downgrade.<\/p>\n
\u201cThose comrades who do not understand this particular phenomenon, we still have to engage them to understand the consequences,\u201d he said.<\/p>\n
The ANCYL recently announced that it welcomed the country’s downgrade while Water and Sanitation minister Nomvula Mokonyane told ANCYL members at a rally that the,”Rand can fall, we will pick it up.”<\/p>\n
Godongwana said it was important for leadership in the country to support new finance minister Malusi Gigaba and to share messages aligned with his position on the country\u2019s economy.<\/p>\n
He warned that if this did not happen, it would place the country\u2019s credibility under risk.<\/p>\n
Although the briefing tried to stick to policy issues without discussing current events, Godongwana shared his views on reports over the recent announcement that the nuclear-build programme would kick off in June.<\/p>\n
\u201cWe said recently that if we do nuclear, we must do it at a scope and pace which is affordable. The test becomes affordability; will the country be able to afford it?\u201d he asked.<\/p>\n
He said South Africa, in light of the junk status would need to \u201csharpen its pencils\u201d and revise its expenditure patterns.<\/p>\n
Godongwana said government would have to take a closer look into the finances of state-owned enterprises if it wants to effectively respond to the downgrade.<\/p>\n
Meanwhile, South African Communist Party (SACP) general secretary, Blade Nzimande, has accused members of the Gupta family of using the African National Congress (ANC) to loot State funds, SABC news reported.<\/p>\n
Speaking on Sunday, Nzimande said: \u201cWe never fought to hand over a country to an immigrant Indian family we don’t know.”<\/p>\n
\u201cBoth the SACP and Cosatu say, ‘difficult as this was, we said for his sake and the sake of the movement and our country president Zuma must step down’.\u201d<\/p>\n
Nzimande also condemned Zuma’s recent cabinet reshuffle, which the ANC has defended.<\/p>\n
The federation of unions re-affirmed its backing of deputy president, Cyril Ramaphosa, to lead the ANC.<\/p>\n
With News24<\/a><\/p>\n
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