Fanie Brink, Independent Agricultural Economist
“The State of the Nation Address (SONA) of President Cyril Ramaphosa will not make any difference to the very dire economic situation in the country as it is a continuation of the socialist destruction of the economy and the country,” says Fanie Brink an agricultural economist.
He referred to the reply of the President to the reactions after he delivered his SONA last week.
The biggest problem that the country experience is exactly the "developmental state that plays a vital role in economic and social transformation" that also still "plays a vital role" in the total destruction of the economy" which means the country will lose its status as a developing country and be degraded into an underdeveloped country with much bigger fiscal and social problems!
"The SONA of the President will not make any difference to the very dire economic situation in the country as it is a continuation of the socialist destruction of the economy and the country."
He said that "the government had been taking extraordinary measures to enable businesses to grow and create jobs..." which is just not correct! All that the government has done was the total socialist regulation of the economy of which the results are very clear for anybody to see that watches the economic scoreboard!!
He also said that the "government was planning to create millions of jobs to drive economic growth" while the government cannot even afford the salaries of its own employees any longer.
In his newsletter on Monday, the President said "... as the government worked to grow the economy and create employment..." which is impossible if no one in the government has any idea how economic growth is being created which is a big problem.
The worst thing is that the government has seem to never even realised that its socialist ideology destroys economic growth. Look at what happened to the growth rate of the Gross Domestic Product (GDP) in the following chart after the National Development Plan was implemented in 2011 - pure economic destruction, while the government is still very conveniently using the Covid-19 pandemic as a smokescreen to hide behind its own destruction of the economy.
None of the government's eight economic plans that were developed after 1994 could create any economic growth because all the plans were based on its socialist ideology that could not sustained any economic growth. While the latest economic growth projections by various local and international institutions are all showing a continuation of the destruction of economic growth to 2% next year and 1,5% in 2024 which might just as well be the last economic growth the country will ever see.
One thing that the president and his government will just never understand is that employment does not create economic growth as it works exactly the other way around because only higher economic growth can create higher employment!! Why would the private sector creates more jobs just to please the politicians if they cannot generate more profits to afford it??
The President said that "one of the most important drivers of growth and employment are state-owned enterprises (SOEs). They generate electricity, manage the ports, build the roads and supply the water that the economy needs to function. Since the advent of democracy, these SOEs have significantly expanded access to basic services for the poor".
It is just no longer correct and there is absolutely no evidence to prove it as there are more than enough evidence to disprove it along with the total corruption involved!!
All the SOEs are corrupt as proven, bankrupt and cannot even pay the salaries of their personnel.
He said that "it is why a critical part of our programme is to strengthen state-owned enterprises, restoring them to financial health, improving their operational performance and enabling them to play a more prominent and beneficial role in the economy” while it was never possible over the past decade or longer and will never be possible within the economic framework of the government!
The President also said that "the government is directly involved in employment creation beyond people employed in the public service which has provided work opportunities to millions of people. More recently, in response to the devastating economic impact of the Covid-19 pandemic, this government has overseen the most significant expansion of public employment in our country’s history" mainly with loans from the International Monetary Fund as the government self was never able to afford it.
"As private sector employment expands, more livelihoods are supported and sustained. Goods and services are delivered at a greater scale and the democratic state is able to collect more revenue for social development” which will not happen as long as the government still does not understand that it is not possible for the private sector to create more employment and deliver more goods and services in a socialist regulated political and economic environment as shown very clearly by the deterioration of the economic growth rate over a prolonged period.
The President is absolutely correct when he said that "... SA would not achieve such an economy without both a strong and capable developmental state " although a "strong and capable developmental state and an inclusive, fast-growing private sector are just like "radical economic transformation" only pure political slogans that mean nothing to the economy and the country as it has almost totally destroyed the economy and increased the fiscal and social problems more than during any other previous period in the history of the country," according to Brink.
Fanie Brink, Independent Agricultural Economist
