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Pityana: Zuma's removal will boost the economy

Oct 05 2016 15:14
Lameez Omarjee

Johannesburg – If President Jacob Zuma resigns, it would have a positive impact on the economy, AngloGold Ashanti [JSE:AGL] chairperson Sipho Pityana said on Wednesday.

Speaking to journalists at a briefing with media at the Joburg Indaba in Sandton, Pityana said: "The things that are holding back the performance of our economy hinge around the lack of policy certainty and around perceptions of high levels of corruption, as well as governance of SOEs (state-owned enterprises). All of (which) revolve around the president,” he said.

During his address at the indaba, Pityana said corruption is spreading across society and running into billions. “The National Treasury identified that there has been R26bn in irregular spending in the past financial year.” About 72% of government departments and SOEs are non-compliant with supply chain management standards.

Spending in all spheres of government will reach R1.5trn in the next three years. Pityana said that Treasury remains under siege.

This has also impacted investor confidence, which could have long-term consequences. As a result, business organisations and leaders have raised concerns around governance.

Neal Froneman, CEO of Sibanye Gold, told Fin24 that the removal of President Jacob Zuma would improve the investment climate. The issue is mainly around  governance. “Business can only work when you have good corporate governance,” he said. Poor governance by the state reflects poorly on business.

“If government had to change the way it works and improve the governance, we will have a better investment climate which means we can invest more into our businesses and grow our businesses,” he said. “We can create employment, we can create transformation and wealth. It is a necessary issue that needs to be addressed."

“If I put my own business in jeopardy then I would step down,” added Pityana. He also said that dealing with corruption would be a step forward in restoring business confidence. “We need a president who will come in and show determination to deal with corruption.”

He said that good governance of parastatals would help build confidence. “We need good and proper leadership to restore confidence.”

WATCH: Sipho Pityana on what the removal of President Jacob Zuma would mean for investor confidence

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