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In the face of the dire economic situation reflected in the medium-term budget policy statement (MTBPS), South Africa can either lament or act, President Cyril Ramaphosa said during a question and answer session in Parliament on Thursday.
"We have chosen to act and undertake the painstaking work to restore our economy on a path of growth," he said in reference to the MTBPS delivered by Finance Minister Tito Mboweni on Wednesday.
"SA is facing huge challenges. We need to change the structure of our economy. For 300 years it has just been structured to look after the interests of a minority. If you look at the policies that we have adopted, you will see efforts have been made to reposition the economy," said Ramaphosa.
He pointed out that tax collection has decreased and "left a hole". He expressed the hope that labour will understand the situation.
"I realise the cost of living in our country is too high and it has an overbearing effect, especially on poor people. Hopefully in about two or three years we will be able to collect more tax," said Ramaphosa.
At the same time, Eskom needs to be funded.
"We are taking steps to make the energy sector more efficient. If the government were to let Eskom go down, the SA economy will collapse. Everybody knows we need to support Eskom as our country's fortunes hang on Eskom. This need has sucked money (from some projects)," said Ramaphosa.
"The only way we could have found money somewhere would have been to borrow more money, but the ratings agencies are in the process of looking at what we are doing and right now borrowing more money is not the most viable option. Therefore, we have to reprioritise our spending."
He said the focus is very much on creating greater economic inclusion by reducing poverty and developing skills.
Ramaphosa said one way to grow SA's economy is to increase the level of investment. In his view, this effort is gathering momentum.
He looks forward to the second SA investment conference set to take place in Johannesburg soon. It is expected to be attended by about 1 500 investors and businesspeople.
"We are facing a dire situation, but we are not yet out. We have to still correct a number of areas. We will resolve these problems. That is my message," he said.
"We have a single-minded focus on the creation of employment on a massive scale, because the working age population is growing much faster than the number of jobs created in our economy."
