J Radebe: Stanlib International Pension Fund Conference

8 November 2007

I am grateful to Stanlib for the opportunity to join you this morning and I
am very pleased that you are holding such an important International Pension
Fund Conference, because the opportunity to work should be premised on a strong
and a robust pension policy.

But my duty this morning is to give a good account and a reflection on the
policies of the African National Congress (ANC) to address the serious
challenges we have faced since coming into office in 1994. In particular, the
overall economic policy of the African National Congress derives from a number
of documents which have been penned by the movement and its partners. In 1992,
the African National Congress released a seminal document on its economic
approach, known as "Ready to Govern."

The central goal of our economic policy was to create a strong, dynamic and
balanced economy that will be directed towards the elimination of poverty and
the extreme inequalities generated by the apartheid system; the democratisation
of the economy and empowering the historically oppressed as well as creation of
productive employment opportunities and living wage for all South Africans.

Underpinning this approach of 'Ready to Govern' was the Reconstruction and
Development Programme's (RDP) vision which stated that:

"The fundamental principles of our economic policy are democracy,
participation and development. We are convinced that neither a communist
central planning system nor an unfettered free market system can provide
adequate solutions to the problems confronting us. Reconstruction and
development will be achieved through the leading and enabling role of the
state, a thriving private sector, and active involvement by all sectors of
civil society which in combination will lead to sustainable growth."

As a result, the collective leadership of the ANC remains steadfastly
committed to building on the foundations that have been laid for future growth
and prosperity since the advent of democracy in 1994.

These foundations have resulted from the policies developed by the ANC led
government, the cornerstone of which was the Reconstruction and Development
Programme (RDP) and the Growth, Employment and Redistribution (GEAR)
policy.

I am honoured on behalf of the ANC to highlight some of these important
economic building blocks that have been put in place. Through improved and
effective fiscal policies that have been applied since our first democratic
election in 1994, the ANC government has reduced its debt burden and the budget
deficit.
This has enabled us to increase real expenditure in health, education, housing,
social grants and other services. Since 2000, public spending has increased by
more than 70 percent in real terms. During the 2000/01 fiscal year,
consolidated expenditure amounted to R233,5 billion, rising to R600,1 billion
for the 2007/08 fiscal year.

Before 1994, the South African economy was virtually stagnant. Since then
the economy grew on average by approximately three percent in the first ten
years of democracy. Since 2004 the rate of growth has risen to over 4,5 percent
a year. The economy is approximately 40 percent bigger in real terms than it
was in 1993.

The real increase in the income of individual South Africans is now growing
at over three percent a year, compared to one percent a year during the first
decade of our democracy. This growth has been the result of careful
macroeconomic management, which has enabled our economy to grow continuously
for more than eight years. This is more than twice as long as any previous
upswing in South Africa's recorded economic history.

The national income per capita has rose by 22 percent per person since 1999,
with increases across all income groups. South Africa has successfully
controlled the rate of inflation through an inflation targeting monetary
policy, implemented by the South African Reserve Bank, together with trade
policy and sound fiscal management.

South Africa has been very pro-active in World Trade Organisation (WTO)
negotiations, advocating for a fairer system of international trade. Our
commitment to freeing trade was demonstrated by halving the number of tariff
lines between 1990 to 2004, with 80 percent of tariffs becoming duty free. We
have also eliminated quotas and most import surcharges. Our economy has become
more competitive, with export volumes increasing at an average of 5,9 percent
per year between 1990 and 2004, and comprising a greater diversity and
destinations of exports.

The economy created about two million new jobs in the first decade of
freedom, at a rate of about 200 000 jobs a year. Since 2004, job creation has
more than doubled, with over 500 000 jobs created each year. Employment is
rising faster than at any point since the 1960s, due to the collective
commitment of the ANC Government. If we maintain our job creation rate at
current levels we will meet our 2004 election manifesto target of halving
unemployment and poverty by 2014.

Recent improvements in our economy have been driven by an increase in the
rate of investment, which was as low as 15 percent of Gross Domestic Product
(GDP) in 2003. Since 2004 it has steadily improved to 18,5 percent of GDP.
Fixed investment is now growing at an average rate of 11 percent a year, since
2002 relative to the GDP. This is due to an increase in public and private
sector investment.

Our economic performance is of course partly a consequence of favourable
global economic conditions in the form of sustained commodity prices, low
interest rates globally and strong international demand, which have combined to
contribute to the momentum of our income growth and to financing investment
through capital inflows. South Africa received R144 billion in capital inflows
in 2006, so that in spite of a current account deficit of 6,5 percent of GDP,
which amounts to R12 billion, we have been able to finance a higher level of
investment, and therefore create opportunities for future growth.

However our undertaking to the people of South Africa, as the ANC, is not
only to build a successful economy, but to address the historical inequalities
and poverty that still scar our country. Our economic successes would mean
nothing if we could not act concretely to improve the lives of the South
African people. In this respect, much has been done to ensure that the benefits
of freedom are shared by all.

Workers' rights are now protected, and employers and workers are
increasingly finding better ways of resolving problems as industrial relations
improve. Vulnerable workers such as domestic workers and farm workers have been
given greater protection.

More and more black people are becoming professionals, managers and
technicians. Policies and laws have been put in place and funds made available
for black people to own businesses to facilitate a greater level of
entrepreneurship amongst South Africans.

Since 2004 we have extended the programme to provide social grants to
benefit 11,2 million of the poorest of the poor in our society. Independent
research shows that the grants are having an important impact in terms of
reducing poverty.

Empowerment initiatives have made great strides since 2004 with the
introduction of a range of progressive empowerment charters and the
finalisation of the Codes of Good Practice for Broad-Based Black Economic
Empowerment (BBBEE), thus ensuring that Black South Africans can have a
significant stake in all sectors of economy.

A key programme for the reduction of poverty and the development of work
experience and skills is the Expanded Public Works Programme (EPWP). The
programme is on course to reach its target of one million job opportunities in
five years. By June 2006, it had surpassed its employment creation targets
across four sectors, with more than 300 000 job opportunities created. The
number of projects within the EPWP is constantly expanding, reaching more
people in terms of work opportunities, services provided and infrastructure
built.

By June last year, 85 percent of all poor households were receiving water
directly to their homes, compared to just fewer than 50 percent of people in
1996. Again we will have to accelerate our progress to reach those who still
have no access to clean water, and on speeding up provision of sanitation
services.

The electrification programme has seen 3,5 million homes electrified since
1994. The ANC has established the Free Basic Electricity Programme where people
earning below a certain income bracket receive a free monthly allocation of 50
kilowatt electricity.

In 1996, only 64 percent of our people lived in formal houses. Today, over
70 percent enjoy this right. Between 1994 and mid-2006, 2,8 million housing
subsidies were approved which is unprecedented in South Africa's history.

Overall, the frontiers of poverty are steadily being pushed back. Between
2001 and 2004, it is estimated that the number of households living below the
poverty line dropped from 4,1 million to 3,6 million. These and other gains in
addressing poverty can be attributed to improving economic conditions and a
wide range of government interventions specifically aimed at addressing
poverty.

In fact, in almost every area of public service delivery there has been
considerable progress to affect improved living standards, from access to
schooling, health care and refuse removal, to electrification, access to
computers, roads and street lights, to sport facilities, telecommunication
services and public transport.

This constitutes tangible progress in improving the lives of the people of
South Africa. It is an approach which is protected by the notion that
democracy, and strong democratic institutions will ensure that government is
able to serve its people.

The new South Africa has a strong Constitution, an independent judiciary, a
free press, and a Bill of Rights, and many other democratic institutions in
order to protect the freedom and the rights of the people of South Africa.

All these achievements are the result of the policies that have been shaped
by the collective leadership of the ANC. These have been articulated in detail
and implemented by the Executive Government of South Africa, formed by the ANC.
The leadership of the ANC is proud of the achievements of our young democracy,
and the foundations that have been laid, but will remain seized with the
challenges that we still face. We will continue the tradition of our collective
decision making as we rise to this challenge.

Our aspiration is to achieve growth of six percent a year or more, an
unemployment rate of below 14 percent by 2014. The ANC leadership will continue
to monitor our progress in sharing the fruits of democracy with the people of
South Africa, and will continue to be accountable and transparent to the people
of South Africa.

I am aware that there has been concern and speculation about the ANC
succession debate in the media. These concerns are misplaced as once a leader
of the African National Congress is elected, that leader has to remain true to
the policies and traditions of the African National Congress.

The policy development process of the African National Congress is a
collective effort, driven largely from a National Executive Committee (NEC)
Policy Committee which I am fortunate to head. Policy positions are
work-shopped with all the structures of the African National Congress and its
alliance partners including other interest groups such as youth, business,
faith-based organisations and other organs of civil society.

The policy positions of the African National Congress are debated and
adopted by the members of the ANC at the ANC National Conference. Neither an
individual, nor a group within the African National Congress, has the authority
to change policy outside the National Conference. Those adopted policies then
become the political mandate of the leadership collective for five years until
the next National Conference.

The ANC is the oldest political party in Africa formed in 1912. Its
leadership, through the ages, has many common traits and offers us much wisdom
and many lessons, particularly around the importance of our collective
leadership and responsibility.

The ANC leadership is a team. In fact I cannot recall any leader of the ANC
ever deviating from the stated policies of the organisation, as adopted at the
National Conference. As an example, our iconic former President, Mr Mandela had
also made a policy suggestion regarding the composition of the National
Executive Committee in 1994, but this was not acceded to by the ANC National
Conference.

As I have indicated, despite the dramatic changes that has been affected to
our economy, the ANC leadership team remains acutely aware that we still face
huge challenges to bring about a better life for all South Africans. In our
mission to tackle the scourge of unemployment, poverty and inequality that
blight the lives of many of our people, our leaders will, in the words of
Martin Luther King Junior, 'accept finite disappointment, but never lose
infinite hope'.

The policies and programmes of the ANC are continually being enhanced and
modified in our efforts to deliver on our mandate to the South African people.
More recent targeted initiatives of government were included in the Accelerated
and Shared Growth Initiative (AsgiSA) and the Joint Initiative on Priority
Skills Acquisition (Jipsa), which will give further impetus to the improvement
of the performance of our economy, including the critical area of job creation.
These initiatives, introduced after discussion within the ANC and with alliance
partners, are aimed at addressing the binding constraints on the South African
economy.

Moving forward, the ANC has placed particular focus on the skills shortage
in the economy. This is a global problem. Europe and America are importing
scarce skills from Africa, and India is running short of Information and
Communication Technology skills. New emphasis is being placed on developing
priority skills and encouraging greater learning in Mathematics, Science and
Technology.

We have also improved the training environment for workers and have started
the recapitalisation of the Further Education and Training (FET) Colleges,
whilst increasing financial support for poorer students within our system of
tertiary education. In addition, we are significantly expanding the resources
devoted to our national capacity for knowledge production, innovation and
research, including through an innovation management framework which includes
the promotion and development of indigenous knowledge.

Emphasis is also being placed on continuing to roll out a state-led
infrastructure investment programme, and promoting strategic investments in
productive activities to diversifying the economy and build towards an overall
investment to GDP ratio of 25 percent.

A number of major investments are being planned in the rail and road
transport network, the telecommunications backbone and international
telecommunications links, new energy production and distribution
infrastructure, which should all impact on the cost of doing business in South
Africa. Further investment is also planned in housing, water and sanitation,
hospitals and clinics, public transport networks, and of course, new football
stadiums.

The investment community in South Africa benefits from a continually
improving economic and social environment built on strong democratic and legal
institutions, and transparent and efficient laws, regulations and institutions
with respect to the financial sector.

In particular, international investors benefit from national treatment,
property rights that are entrenched in our legal system, and the ability to
repatriate profits and capital freely. South Africa has continually improved
its ratings with the international credit rating agencies and has never
defaulted on coupon or capital repayments on its debt.

Our domestic policy approach is also reflected in our foreign policy
priorities. South Africa remains a committed member of the international
community, pro-actively engaging international debate for a fairer global
system that supports development, whilst promoting best practise and
international standards through the multilateral system. Within Africa, South
Africa is an active member of the Southern African Development Community (SADC)
and the African Union (AU), where much attention is placed on policies and
programmes that will support the development of our continent, such as the New
Partnership for Africa's Development (Nepad).

The ANC continues to build on its long-term commitment to push the frontiers
of poverty by adhering to the Freedom Charter and taking the long-term
decisions to deliver a better life for all our children and grandchildren and
for the generations to come.

In conclusion, the Government's Medium Term Budget Policy Statement,
released last week correctly observes that: "Our domestic economy remains
strong buoyed by rising investment, productive capacity, rising employment and
incomes, strong consumer demand and healthy capital inflows."

This statement indicates much more profoundly that the South Africa of today
is better than yesterday and that tomorrow will be better than today.

I thank you.

Issued by: Department of Transport
8 November 2007
Source: Department of Transport (http://www.transport.gov.za)