Nationalisation debate: Minister Gigaba concedes that nationalisation is damaging to our economy
The Democratic Alliance (DA) notes Public Enterprises Minister Malusi Gigaba's statement today on nationalisation. The Minister, who was addressing the American Chamber of Commerce, conceded that the debate over mine nationalisation was deterring foreign investment (see report). This is in line with the DA's view, and we welcome the Minister's sentiments, especially coming from a former head of the ANC Youth League.
The Minister's exact words were: "We who run the country know the harm this reckless debate is doing to the good image and investments of the country."
We are pleased that senior Cabinet members are going on record against the argument favouring the nationalisation of mines. Unfortunately it also indicates that there is a deep divide within the Cabinet and the ruling party, with one camp willing to entertain a damaging debate about the future of private assets in South Africa and a more moderate grouping, which seems to include Minister Gigaba, that realises the damaging effect of such a debate on our growth prospects.
Only last week, the UN released a report indicating that foreign direct investment (FDI) into South Africa had plummeted by 70% in the last year. The DA believes that increased uncertainty around our economic future has contributed to the decline. The combined effect of increased uncertainty and a drop in investment will be to destroy jobs in our economy and leave more South Africans unemployed.
It is time for senior leaders in the ANC to come out strongly against the irresponsible economic policy positions advocated by some of their members. These include proposed legislation to increase taxation on investment properties and extend over-regulation in our labour market, the debates around expropriation of land and the nationalisation of mines, and knee-jerk opposition to FDI.
It is time for strong leadership from President Zuma and senior cabinet ministers who support a sensible approach to managing the economy and investor perceptions.
Statement issued by Tim Harris MP, DA Shadow Minister of Trade and Industry, August 1 2011
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