Ramaphosa Tackles South Africa Challenges as Investors Sought
(Bloomberg) -- South African President Cyril Ramaphosa has taken steps to tackle the extensive challenges facing the country.
In the two months since he replaced Jacob Zuma as head of Africa’ most-industrialized economy, he’s sought to put the country back on track following years of mismanagement. The government will offer incentives to lure $100 billion in investment to the country, Ramaphosa said in an interview with Bloomberg TV in London on Wednesday.
Here’s what his administration has accomplished so far:
- The cabinet has been overhauled, with several ministers implicated in corruption or mismanagement losing their posts and proven technocrats appointed to oversee the key economic departments.
- New boards have been appointed at some troubled state-owned entities, including power utility Eskom Holdings SOC Ltd., the Passenger Rail Agency of South Africa, and Denel SOC Ltd., the state weapons company.
- The head of the tax collections agency, who consistently failed to meet tax targets and was accused of shielding his deputy in a graft probe, has been suspended.
- The mines ministry has begun re-negotiating draft black empowerment rules that the industry says would deter investment.
- Law enforcement agencies are cracking down on members of the Gupta family and their allies, who are friends with Zuma and have been accused of looting billions of rand from the state.
- The government last month staved off a junk credit rating from Moody’s Investors Service that could have sparked a massive sell-off of the country’s debt.
- The National Treasury released a budget that recommitted the government to its expenditure ceilings and to progressively narrow the fiscal deficit.
These are some of the most pressing challenges Ramaphosa still needs to address:
- Finalizing policies that will cater to the ruling party’s demands for land seizures without spooking investors.
- Reviving an economy that the World Bank projects will grow just 1.4 percent this year and reining in a 27 percent unemployment rate.
- Fixing an education system that ranks among the world’s worst and leaves millions of youths without marketable skills.
- Reducing a murder rate that’s more than six times higher than in the U.S.
- Ridding his cabinet of several more ministers who’ve been accused of being ineffective or have been implicated in graft, but were retained because of their political clout.
- Cementing his control over the ruling party following a narrow victory in its leadership elections in December last year.
©2018 Bloomberg L.P.