SA has failed to share economic growth - Zuma

Cape Town – Despite an improved economic outlook, South Africans have to acknowledge that we are not growing fast enough to significantly reduce our triple challenges of poverty, inequality and unemployment, President Jacob Zuma said on Tuesday.

Speaking at a pre-State of the Nation Address (SONA) lunch with business and labour leaders, Zuma called on those present to work with government to overcome the challenges.

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The event lost its impact after Deputy President Cyril Ramaphosa postponed the signing of a minimum wage agreement that had been planned to take place during the lunch.

"The postponement follows a request from Cosatu to be given time to provide a full report to its central executive committee," the presidency said in a statement on Tuesday.

Business leaders attending the event included Barclays Africa CEO Maria Ramos, Telkom chairperson Jabu Mabuza, businessman Vivian Reddy and JSE CEO Nicky Newton-King.

Cabinet ministers present included Ramaphosa and ministers Rob Davies (trade), Lynne Brown (state-owned enterprises), Ebrahim Patel (economic development), Lindiwe Zulu (small business) and Naledi Pandor (Science and Technology). Finance Minister Pravin Gordhan joined Zuma's luncheon following his speech at a lunch held at the Mining Indaba in Cape Town.

“A most important challenge we need to confront head on this year is the scale of inequality and exclusion in this country,” Zuma said. “It needs urgent action.

“After two decades since democracy, the black majority still remains largely outside of the mainstream economy.

“Social justice cannot be achieved if we allow the status quo to persist. Economic inclusion since 1994 demonstrated that we can grow the size of the economy.

“We have, though, failed to ensure that the growth is shared. As we begin a new phase of economic recovery we have to make sure we take everyone along. We have to rework and sharpen our transformation model and, more importantly, demonstrate commitment and empathy.

“We should never rest until the vision for a better life for all is realised, all of us as labour, business, the community sector and government.”

WATCH: Zuma's full address

Zuma said the largest employers of unskilled workers are shrinking in importance. “This puts more workers in the job market, being not only unemployed but also largely difficult to employ due to lack of skills,” he said.

“Low economic growth and pressure on revenue suggest that the public sector can no longer be the main engine of jobs growth,” said Zuma. “We used to rely on government to absorb the unemployed. The public service is also facing pressure.”

A key issue to address this was identified in 2016, when government, business and labour pledged to create a one stop shop to overcome obstacles to doing business in the country.  

“We established the Inter-Ministerial Committee on Investment, which has been discussing the coordination and alignment of investment policy and regulation including the marketing of South Africa as a preferred investment destination,” said Zuma.

“A dedicated division in the DTI (Department of Trade and Industry), InvestSA, has been established which will focus on investment promotion, facilitation and aftercare.

“The national One Stop Shop service for investors will be launched in March 2017 at the DTI Campus in Pretoria and 3 Provincial One Stop Shops will be launched by mid-2017.

“The One Stop Shops will be the focal point of contact in government for all investors to coordinate and facilitate with the relevant government departments involved in regulatory, registration, permits and licensng.

“InvestSA will provide specialist advisory, intergovernmental coordination, fast track unblocking and red tape reduction in government.”