State of the Province Debate with Minister Maynier | Western Cape Government

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State of the Province Debate with Minister Maynier

23 July 2019

We have done more than any other province over the past ten years to promote economic growth and to create jobs in the Western Cape.

We have worked hard to create an enabling environment for the private sector, which has created more than 500 000 jobs over the past ten years in the Western Cape.

But, despite our hard work, we still have hundreds of thousands of people who are unemployed in the Western Cape.

So we have to find a way to give hope to those people, especially young people, who do not have jobs, or have given up looking for jobs in the Western Cape.

Because they deserve to live with dignity, with independence and with hope in the Western Cape.

But the scale of the challenge is huge, because we are in deep economic trouble in South Africa.

We have:  

  • stagnant national economic growth, with the economy forecast to grow at an average of 1.5% over the medium term;

  • declining national per capita incomes, as the population growth rate exceeds the economic growth rate; and

  • high national unemployment, with a staggering 9.9 million people who do not have jobs, or who have given up looking for jobs, in South Africa.

We are in deep economic trouble, not because of national government’s failure to implement economic policy, but because of national government’s reckless economic policy in South Africa.

We have land expropriation without compensation; we have prescribed assets, state banks and sovereign wealth funds; and we have the nationalization of the reserve bank in South Africa.

We have:

  • a president who is supposed to take the tough decisions on the economy, but who prefers to call summits, dialogues and conferences.

We have:

  • a finance minister who is supposed to be in charge of the macro-economy, but who is not taken seriously by his own cabinet.

And we have:

  • a trade and industry minister who is supposed to be in charge of the micro-economy, but who is shackled to the idea of a Soviet-style smokestack economy, with workers happily singing “The Internationale”.

Which is why investors, including investors who are used to investing in risky emerging markets, are hesitant to invest in South Africa.

We have a national government that makes it difficult, but not impossible, to drive economic growth and job creation in the Western Cape.

As Premier Alan Winde pointed out in his State of the Province Address, our first priority is to create more jobs and more economic opportunities for people in the Western Cape.

We will not give up, and we will do what it takes to give hope to people, especially young people, who do not have jobs, or who have given up looking for jobs, in the Western Cape.

We will:

  • create an efficient regulatory environment by supercharging the red tape reduction unit to begin dealing with sector-wide and system-wide challenges to economic growth, such as visa regimes, tariffs, port fees, slow planning processes and licence regimes negatively affecting the economy in the Western Cape.

We must eliminate obstacles to opening new businesses, and growing existing businesses, because with more employers, we can have more employees, in the Western Cape.

We will:

  • strengthen support for sectors of the economy that can contribute to economic growth and job creation, such as construction, business outsource processing and manufacturing in the Western Cape.

We will:

  • support small businesses, especially small businesses in the informal economy, through a support package, including our “SMME Booster Fund”, which supports small businesses in the informal economy in the Western Cape.

We will:

  • scale up our workplace experience programmes to prepare people, especially, young people, for the world of work in the Western Cape.

And we will:

  • build an economy that is resilient by ensuring that it becomes more energy independent, by more importantly, seeing that municipalities can buy power from independent power producers in the Western Cape.

We will also build on the successes of “Cape Town Air Access”, which has done such great work launching new routes, expanding existing routes and growing seat capacity numbers at Cape Town International Airport.

We look forward to welcoming the inaugural flight of United Airlines, which will be flying non-stop from New York to Cape Town, on 16 December 2019, and which will generate millions of Rands in additional spending by tourists in the Western Cape.

We are particularly pleased to be able to announce here for the first time today that we have reached a new milestone when it comes to the establishment of the Saldanha Bay Industrial Development Zone.

We were informed late last week that the application to make the port, and key portions of land adjoining the port, a Customs Control Area has been approved by the South African Revenue Service.

This means: 

  • there will be less onerous customs procedures for goods moving into, within and out of the industrial development zone to export destinations; and

  • hefty upfront value added tax payments for goods coming into the industrial development zone for repair and maintenance will be waivered by the revenue service.

Which will go a long way to make the Saldanha Bay Industrial Development Zone a destination of choice for the oil and gas sector and bring us closer to the vision of creating a world-class oil, gas and maritime centre right here in the Western Cape.

We must acknowledge, however, that stagnant economic growth, declining per capita incomes and staggering unemployment are only part of the problem in South Africa.

Because, with stagnant economic growth comes collapsing revenue, ballooning fiscal deficits, eye-watering national debt and a looming sovereign credit ratings downgrade in South Africa.

What we must not forget is that in two years’ time, national government will spend R247 billion servicing our national debt, which is a staggering R179 billion more than we will spend this year in the Western Cape.

Worse, we have zombie state-owned enterprises, such as Denel, South African Airways and Eskom, gobbling up billions of Rands in bailouts in South Africa.

The full horror of national government’s mismanagement of the economy, mismanagement of our public finances and mismanagement of our state-owned enterprises is going to have major implications for provinces in the form of unprecedented budget cuts over the medium term, which risks wiping out service delivery in provinces in South Africa.

We are not going to simply stand by and allow national government to impose budget cuts on this province to, in effect, bail out national government so that they can bail out zombie state-owned enterprises such as Denel, South African Airways and, worst of all, Eskom.

What we are going to do, in the end, is to work hard to give hope to people who do not have jobs, or have given up looking for jobs, and who live without dignity, without independence and without hope in the Western Cape.

I thank you.

Media Enquiries: 
Francine Higham
Spokesperson for the Provincial Minister of Finance and Economic Opportunities
(Responsible for the Provincial Treasury and the Department of Economic Development and Tourism)
Tel: 021 483 4327
Cell: 071 087 5150