New Growth Path: No vision, no framework, no direction, no substance
Today's post-Cabinet announcement of a ‘New Growth Path' has served little purpose except to create further confusion about the country's economic trajectory.
In fact, while Ministers Patel, Chabane and Nkwinti referred frequently in their briefing to a ‘shared vision' for South Africa's economic policy, the truth is that there wasn't much sharing, or much vision. We were told nothing about specific policy instruments on either monetary or fiscal fronts, nor was there any sign that the ANC has a coherent understanding of how it can create jobs and long-term economic growth.
What is perhaps most baffling of all is that it surely serves little purpose to announce a major new economic growth framework, but to then claim that details are still being ironed out, that specific interventions have not yet been decided upon, and that the public should wait until lobby groups are consulted, before being informed of the plans. This is policy-making in reverse - it remains uninformed by a clear vision and set of principles and strategic objectives.
Of particular peculiarity, too, is the fact that on a supposedly powerful new economic policy framework, the announcement was not even attended by the most important minister in cabinet's economic cluster, Finance Minister Pravin Gordhan. It is difficult to know how to read Minister Gordhan's absence as anything other than a further sign of deep political schisms at the very centre of Jacob Zuma's cabinet.
After all of the hype, the lack of substance from today's announcement points to deep divisions within President Zuma's cabinet.
Where is the country supposed to take economic direction from? Minister Patel was the one making the announcement today and yet had to defer any macro-economic details to the absent minister of finance. The fact that the cabinet seems to be split in two over economic policy, with neither direction having a clear mandate, is worrying indeed for our country.
And the fact that such schisms exist, as evidenced by today's press conference, means that there is no clear vision for creating jobs, and building a new growth path for South Africa. Only obfuscation, confusion and vague promise-making that is desperately short on detail.
Most notable was Minister Patel's equivocation on the issue of a floating currency. The minister responded only vaguely to one question from the press on the subject, and when subsequently queried about whether other exchange instruments were being considered, the minister audaciously claimed he had already answered the question. Such a lack of clarity will do little except upset markets that hate uncertainty.
And amidst all of this talk of creating new economic opportunities and addressing the major impediments to job creation, it remains disheartening that the one intervention which really can succeed in creating jobs right now, and which the Minister of Finance was at one stage commendably pursuing, appears now to be dead in the water. It is notable that wage subsidies have been removed from the ANC's vocabulary in recent months, and that this appeared to be the case again today.
The fact of the matter is that clarity and vision are needed in our economic policy making, and in announcing their new economic framework today, the Zuma administration showed desperately little of either.
Statement issued by Kobus Marais MP, Democratic Alliance Shadow Minister of Economic Development, October 26 2010
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