The impact of the reforms implemented by the government over the past two years and that are geared towards facilitating economic growth in SA is unlikely to be seen in the near future, says President Cyril Ramaphosa.
The reforms — stabilising the supply of electricity and water, reducing the cost of digital communication, improving the efficiency and competitiveness of the country’s ports, and developing a visa regime that attracts skills and growth — are the “only way to shift our economy from stagnation to dynamism”, Ramaphosa said in his weekly newsletter on Monday.
“Many of these reforms are complex, involving new ways of working and even the establishment of new institutions. In some cases, it will take time for us to see their full impact,” he said.
Structural reforms aimed at accelerating growth and employment have long been in the pipeline but have gained momentum in recent years as the government lures private sector investment to key sectors of the economy as part of Ramaphosa’s plans to kick-start the pandemic-battered economy.
Operation Vulindlela, a joint initiative of the presidency and the Treasury, has been tasked with accelerating the implementation of the reforms to increase support for potential growth.
A progress report, which was released on Monday, on the work of the unit that monitors and assists government departments in implementing reforms shows that though Ramaphosa’s reform agenda is gaining momentum, challenges remain. This includes implementing the government’s emergency power procurement programme and Eskom’s target to reach 70% of energy availability factor (EAF), two critical programmes needed to decrease electricity supply constraints.
According to the power procurement timeline, winning bidders of the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP), which has been delayed due to ongoing litigation and delays in reaching financial close, should have received the required regulatory approvals by June this year.
Operation Vulindlela, which was launched in 2020, says eight of its 26 reforms are completed while nine are on track for completion.
Among the completed reforms are implementing the e‐Visa system in fourteen countries — including China, India, Kenya and Nigeria; corporatising the Transnet National Ports Authority (TNPA) into an independent subsidiary of ports operator, Transnet, as well as allowing third party access to the country’s rail networks.
“The establishment of the National Ports Authority as a separate subsidiary of Transnet last year had been delayed for more than 15 years. This was the necessary first step towards enabling private sector participation and increasing the efficiency of our port terminals,” said Ramaphosa.
Other reforms that are on track include raising the licensing threshold for new generation projects to 100MW, allowing these projects to connect to the grid and sell power to customers, as well as revival of blue and green drop water quality assessments, which monitors the quality of drinking water.
“Changes to the regulations on new generation capacity have allowed municipalities to procure power independently for the first time. And legislative reforms will ultimately give birth to a new competitive electricity market, supported by the publication of the Electricity Regulation Amendment Bill and the work under way to amend the Electricity Pricing Policy,” said Ramaphosa.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.