Like oil tankers in Hormuz and music from the 1970s, South Africa’s economic reforms are trapped in dire straits. But while the Strait of Hormuz is beyond our control, government — at least the ANC component — has had eight years since state capture to turn around the economy. Yet reform remains not only “so far away from me” but from the whole country.
Every small step forward in our economic journey comes with a disclaimer. We have had consecutive quarters of economic growth, but it’s at a pace too slow to meaningfully fix unemployment.
We finally have a stable electricity supply, but at enormous cost. We have a National Treasury that started implementing common sense measures like spending reviews and ghost worker audits. Yet the same entity introduces draconian public procurement regulations that will increase government spending on everything from toilet paper to trucks.
The fact that economic reform is stuck or slow is not surprising. It’s hard to turn a ship around when the captain is largely absent and the crew yank the helm in opposing directions. Yet here we are. The DA, instead of sitting on the outside yelling, is inside the engine room, part of this existential tug of war.
Had we still been in opposition, petrol and diesel would likely have cost R3/l more since May. South Africans would also be paying an extra two percentage points in VAT since last year. Government debt would be higher, bonds would be more expensive.
It’s tough and often frustrating communicating the political message of “things could be worse”, but the DA will not shy away from its hard-fought yards. It has mattered that the DA has been in the room. As the consequences of war in Iran continue to ripple down to our waterline, we will continue to fight for control of the helm.
Even if the Strait of Hormuz opens tomorrow, the effects of the past few months of fighting are bleak. Fuel prices will not come down overnight. Interest rates will likely increase. Economic growth and the tax take will likely come in below expectations. All of this means the government will have to make painful choices — pain either borne by normal South Africans or the looting class.
We want to make sure it’s the latter that suffers. South Africans can’t be required to give their taxpayer money for nothing while the executive class in government picks up their salary cheques for free. If anything, taxes need to trend downwards.
Our economic reforms remain stuck. Perhaps it will take the urgency of a crisis far away to dislodge them from our strait of hor-miserable.
• Dr Burke is DA finance spokesperson.
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