Department of Economic Development, Tourism & Environmental Affairs Vote Four Budget Policy Speech 2017/2018 delivered to the Kwazulu-Natal Provincial Legislature by MEC for Economic Development, Tourism & Environmental Affairs, Mr Sihle Zikalala on 5th May 2017
Theme: Attainment of a Radically Transformed, Inclusive and Sustainable Economic Growth for KwaZulu-Natal!
1.Recognition of dignitaries
Madam Speaker, Honourable Ms L Johnson
Deputy Speaker, Honourable Dr M Hadebe
The Premier of the Province of KwaZulu-Natal, Honourable Mr TW Mchunu
The Honourable Members of the KwaZulu-Natal Executive Council
Honourable Members of this House
Representatives of all of our Social Partner Formations
Members of the Diplomatic Corps
Your Worships, the Mayors
The Leadership of our Province
Distinguished guests
Members of the Media present
Ladies and gentlemen
2. Scene setting
Honourable Chairperson, it is an honour and privilege to present the 2017/2018 Budget Vote for the Department of Economic Development, Tourism and Environmental Affairs.
We meet as our country celebrates the centenary of one of the outstanding Presidents of the African National Congress and a colossus of our struggle for liberation, Cde Oliver Reginald Tambo.
President Oliver Tambo is one of the many heroes and heroines of our struggle against imperialism, colonialism and, latterly, apartheid. His was a struggle for global justice; self-determination, equality and, importantly, a struggle for economic freedom.
The budget policy speech that we rise to present today is not solely about the allocation of resources to various programmes. It is definitely not about espousing heavy developmental philosophies.
Our budget today is about taking forward the struggle of those who laid the foundation for our democratic project and to build a National Democratic Society – a society that is non-racial, non sexist, democratic, united and prosperous.
The journey to the National Democratic Society will be retarded without economic liberation of the majority of the people.
We, therefore, agree with President Oliver Tambo when he said that “It is inconceivable for the liberation to have meaning without a return of the wealth of the country to the people as a whole.
To allow the existing economic forces to retain their interests intact is to feed the roots of racial supremacy and exploitation, and does not represent even the shadow of liberation.
It is therefore a fundamental feature of our strategy that victory must embrace more than formal political democracy; and our drive towards national emancipation must include economic emancipation.”
Honourable Chairperson, twenty three years into democracy and freedom, the persisting challenges that confront the historically disadvantaged demands that we pay urgent and sufficient attention in restoring wealth to the majority of the people – hence our call for radical economic transformation.
As eloquently explained by His Excellency, President Zuma in his State of the Nation Address early this year, by radical economic transformation we mean “a fundamental change in the structure, systems, institutions and patterns of ownership, management and control of the economy in favour of all South Africans, especially the poor, the majority of whom are African and female, as defined by the governing party which makes policy for the democratic government.
The Honourable Premier during his State of the Province Address further amplified the essence of radical economic transformation. The Premier asserted that, “As we work tirelessly, to grow a diverse economy, we will do so with a firm eye on ensuring greater inclusivity.
We are keen to see the following sectors contributing to this objective – manufacturing, tourism, automotive, mining, clothing and textile, maritime and township economy”.
In our province, we have designed targeted programmes aimed at practicalising radical economic transformation which we will share with you today.
We have also established energetic coalitions with social partners that include labour, business and civil society. Collectively, we have committed ourselves to the eradication of the high levels of inequalities, poverty and unemployment that continue to deprive the majority of our people any sense of freedom.
It is for this reason that we are delivering this budget speech under the theme: “Attainment of a Radically Transformed, Inclusive and Sustainable Economic Growth for KwaZulu-Natal.”
3. Global Economic Developments
Honourable Chairperson, the global economy is still considerably constrained by a number of headwinds which continue to restrain sustainable and equitable economic growth.
In our case, we further face a challenge of ensuring that, as the growth picks up; its benefits are equitably enjoyed by all citizens. Global economic growth is expected to remain around the 3.5% mark over the next year or two.
Advanced economies such as the United States of America (US), Japan, the Euro area and the United Kingdom (UK) are not going to post sizable economic growth over this period.
In the US, the initial optimism following the election in November 2016 has been eroded somewhat after economic indicators remained lackluster. Global manufacturing as measured the Purchasing Manager’s Index is set to move sideways around the 52 points while world trade volumes (exports) are viewed positively, especially for developing economies.
Inflation projections for 2017 have been revised higher in some emerging economies including China, Turkey, Venezuela and Nigeria. These developments are likely to dampen trade in our traditional export markets and are a firm reminder to diversify our trade.
In the UK, uncertainty about future relations with the European Union after the BREXIT vote is keeping the pound under pressure and weighing on fixed investment decisions.
The UK is among the top 10 trading partners for South Africa and for us the interest is on the impact of BREXIT on our trade with both the UK and EU. The BREXIT process is going to take a while to be finalised and the envisaged disturbance for us is minimal.
The greatest challenge for most developing economies remains adjusting to the adverse impact of China’s gradual slowdown and rebalancing on global commodity prices.
Although the acute phase of the commodity price shock is probably over, most developing countries still face challenges of fiscal vulnerabilities, slow progress with much-needed structural reforms, domestic strife, political discord and geo-political tensions. Full speech [PDF]
