A key constraint preventing the ANC from achieving the industrial growth it aims for is the national electricity shortage, according to a discussion document issued by the party ahead of its National General Council (NGC) taking place in October.

The document states that, despite a number of interventions by government, growth in SA remains too low and job creation insufficient. External demand also remains low, as growth in many of South Africa’s overseas trading partners remains weak, retarding investment.

Key interventions adopted by government in an attempt to stimulate inclusive growth and investment in the domestic economy were counter-cyclical fiscal policy, public infrastructure investment, industrial and trade policy measures and the acceleration of the Broad Based Black Economic Empowerment Act to transform ownership patterns.

“While these interventions have prevented job losses, they have not shifted the economy onto a new sustained inclusive growth path,” according to the document.

The counter-cyclical fiscal policy was aimed at maintaining aggregate demand through continuing planned levels of government expenditure despite a slowdown in tax revenues.

“Rising government debt and a wide current account deficit make South Africa vulnerable to global economic shocks,” states the document.

The ANC sees infrastructure as an essential pre-requisite for increased investment and employment, but says in the document that such infrastructure comes at a cost.

In addition to putting pressure on the fiscus, the document explains that it is also putting upward pressure on the cost of living and the cost of doing business, an effect that is particularly amplified in a low-growth environment.

As for industrial and trade policy measures aimed at stimulating investment in industrial activity and promoting South African exports, the document states that in many cases, the Industrial Policy Action Plan (Ipap) has not gained traction across the relevant implementing agencies or departments.

Regarding the Broad Based Black Economic Empowerment Act, the document says a recent review will close a number of loopholes and deal with firms who engage in “fronting”.

The ANC expects this to better align its B-BBEE imperatives with the need to promote industrialisation of the SA economy.

“To facilitate a more meaningful participation of black people in the mainstream economy government is now looking at various ways of developing and sustaining black industrialists, including a targeted incentive to support black entrepreneurs entering the industrial sector,” said the document.

The NGC takes place as the country marks the 60th anniversary of the adoption of the Freedom Charter, a seminal document of the mass democratic movement and our prime political programme of action. It further takes place two years after the adoption of the National Development Plan which is the visionary blueprint of our country, aimed at guiding and accelerating the development of South Africa to 2030 and beyond. The NDP has been translated into governments MTSF (Medium Term Strategic Framework) for the period 2014-2019 as the first five year programme for its implementation. The discussion documents are intended to guide deliberations and provide a critical assessment of the work done to date.

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NGC Discussion Document: Economic Transformation for a National Democratic Society

At the core of the ANC’s economic mandate is the transformation of the economy for inclusive growth. At the heart of radical economic transformation is an effective state that is decisive in its pursuit of structural change.

In addition, transformation is about capability and action: the means and the end. Our policies must provide the most enabling conditions for the flourishing of the talents of all our people, to harness and develop their productive potential, to ensure that they play a leading role in the allocation of national resources and that they get their due in the country’s wealth.

The state must therefore play a key role in stimulating national development. This includes the infrastructure build programme, partnership with the private sector, targeted procurement and dealing with binding constraints such as weak energy supply.

Realising these ambitious goals of economic transformation requires moving forward in a number of areas such as ICT, transport, food and energy security, transforming ownership and control. These are the many interwoven dimensions of development.

MACRO-ECONOMIC OVERVIEW

The global economy remains mired in a low growth trajectory, and there is little evidence of a strong recovery despite the growth of 3.4% expected in 2015, which is still insufficient to reverse output and job losses in most economies. The fall in the oil price generates clear opportunities for oil importers like South Africa, but the combination of lower commodity prices, weaker global demand and higher interest rates could lead to weaker growth outcomes on the African continent.

A relatively subdued economic performance as reflected by the world GDP growth, is of concern as demand for South African produced goods and/or services could be adversely affected. Weak Eurozone demand for South African-manufactured exports and reduced demand for our mining and processed metal sector commodity exports from China’s slowing economy is expected to continue to impede South Africa’s economic growth.

The core structural weakness of South Africa’s economy is its continued incorporation into the global division of labour as producer and exporter of primary commodities, and importer of valueadded, manufactured products. This growth trajectory – typical of many colonised countries in Africa – constrains our ability to create jobs at an appropriate skill level and in sufficient numbers to address South Africa’s unemployment challenge, and bestows the benefits of local value-addition (jobs, company profits which can be re-invested in the economy, tax revenue and industrial deepening) on our trading partners.

Given the current and forecast subdued demand for South Africa’s key commodity exports and weak prices, our current growth trajectory cannot be sustained, nor has it proven to be supportive of inclusive growth. Very few countries have been able to achieve sustainable growth, job creation and declining inequality based on a commodity export growth path. It is consequently imperative that we act decisively to industrialise, add value to local and regionally available commodities, and grow the productive sectors of the economy.

The African continent has become a very important destination for locally manufactured products and its relative share is expected to expand further. Moreover, substantial investment in Africa’s infrastructure, rapid urbanisation, and a fast-growing and increasingly sophisticated consumer market all provide improved trade and investment opportunities for South African businesses.

It is therefore crucial for South Africa to improve the competitiveness of the domestic environment – including moderating administered price increases, reducing the anomalous port and freight subsidies for commodity exporters and better managing the level and volatility of the Rand – so as to grow the pool of industrialists exporting to their traditional markets while also finding alternative markets, primarily in the relatively faster growing African, Asian and Latin American economies. This improved growth outlook for Sub-Saharan Africa (over 5% in 2015) and the African continent should provide export opportunities for South Africa’s tradable goods and services. Continued infrastructure development, investor appetite for the region’s mineral and agricultural resource wealth, and strong domestic consumption spending should support these rates of expansion. Intra-African trade is unfortunately dismally low (around 10%) comparatively, with very slow progression and also quite imbalanced to the advantage of South Africa with no clear framework and firm commitment to enhance Intra-African trade.

State-led investment for industrialisation

The NDP envisages that over time annual public and private investment levels should be raised from the current 19% to 30% of GDP.

State-led economic transformation does not imply that the state can go it alone in driving development. Rather, successful state-led investment must serve as a catalyst for increased levels of private sector investment. Recently there have been claims of trust deficit between government and the business community. Such alleged trust deficit has to be closely scrutinised because the business community is not homogenous.

The state-led public investment programme provides a strong stimulus to growth and employment, but it can never be of sufficient magnitude to uplift the whole economy. At about 30% of total investment, public-sector investment, can only serve as a catalyst to facilitate, ‘crowd-in’ and increase private sector investment which contributes 70%.

Investment by state owned enterprises rose sharply from 2007 and continued to grow at a lower rate after 2008. General government investment (mainly construction of social infrastructre like hopsitals, schools and police stations) remained low during the recession, but is now growing strongly. However, private sector investment remains very weak.

The priority now is to identify and remove obstacles to increased levels of private sector investment, while sustaining the public sector’s contribution. Among others, the following items should be foremost on the agendas of public and private sector decision-makers aimed at increasing investment levels in South Africa:

• maximise localisation benefits from South Africa’s ongoing public infrastructure expansion, particularly in power and rail

• support black-owned industrial firms in particular to be part of South Africa’s infrastructure expansion

• leverage state rights (minerals, land, water, air, fisheries, etc.) to maximise economic growth and transformation

• leverage local demand to link into global market supply chains

• successfully implement the newly launched Special Economic Zones

• deepen trade and investment ties with other African countries and with other important growth regions

• raise mining investment, output and linkages into the economy

• unlock South Africa’s significant potential as an onshore and offshore gas producer, in an environmentally responsible manner

• accelerate land reform and grow the number of successful black farmers participating effectively in the agricultural economy

• improve telecommunication infrastructure and increase sector competition

• leverage our maritime position, including through ship-building and repairs, trans-shipment hubs and expanded ocean trade

• grow the tourism sector.

If consensus, and effective action, were to be achieved on issues such as those listed above, there is no doubt that investment levels in South Africa would rise towards the NDP’s investment target.

ECONOMIC SECTORS

In the 53rd Conference, we resolved to “ensure long term stability and sustainable growth and development that bolster the growth of domestic industrial capacity and in making policy trade-offs will select those that favour productive sectors of the economy”. This means we have prioritised re-industrialisation and we will employ a battery of tools within our policy space to privilege productive sectors. The 53rd Conference also emphasises the NGP and the IPAP make up “the industrial policy action plan which guides the reindustrialisation of the South African economy”.

AGRICULTURE, FORESTRY AND FISHERIES

Growing the agricultural and agri-processing sectors will improve national food security, increase agricultural income and support rural development. We have adopted policies that broaden and deepen linkages between agriculture and machinery and equipment industries, including:

• Food Security for all;

• Strategies to increase the contribution of Agriculture to economic growth; and

• Unlocking the sector’s ability to produce 1 million decent jobs by 2030.

One challenge here is that in recent times agricultural productivity has been linked to mechanisation whereas South Africa urgently needs the agricultural sector to be a source of employment as well.

A new Agricultural Policy known as the Integrated Growth and Development Policy (IGDP) with the Agricultural Policy Action Plan (APAP) serve as a programmatic response, identifying priority commodities with high growth potential, food security potential, and to contribute to GDP. The APAP could potentially become the IPAP for agriculture, a platform for sector organisations and other stakeholders to converge through joint planning.

RURAL DEVELOPMENT, LAND REFORM AND AGRARIAN TRANSFORMATION

In the 53rd Conference, we affirmed rural development and land reform as a priority. In giving expression to this urgency, we placed rural development as one of the five priorities in our 2014 Elections Manifesto.

Our Rural Development Framework is now firmly rooted in the approach to rural development we formulated in the 53rd Conference. It saw the introduction of the agrarian transformation system, which is comprehensive and inclusive in approach and defined as rapid and fundamental change in the relations (systems and patterns of ownership and control) of land, livestock, cropping and community. The strategic pillars of land reform (land redistribution, restitution, development and land tenure) continue to form part of this comprehensive and inclusive approach to rural development and land reform.

The next phase of this approach is the Rural Economy Transformation Model (RETM), firmly aligned to Vision 2030. Our strategy of ‘agrarian transformation’ promotes labour-intensive technology, relies on decentralised patterns of local control and takes seriously the input of ordinary citizens into decisionmaking processes, especially in areas dominated by communal landholdings and patrimonial authority

MINING AND MINERALS

In line with our 53rd conference resolutions, we need to elaborate concrete forms in which the state should maintain a strategic, interventionist role in key sectors, to ensure that all our natural resources are exploited to effectively maximise the growth and employment potential embedded in such assets, and not purely for profit. In this regard we subscribe to the aims of the AU “Africa Mining Vision” (AMV) and the Country Mining Vision (CMV) Guidelines:

“The ANCs policy as per the 53rd conference resolution is based on the following elements:

• • Minerals for manufacturing: Steel (iron ore), polymers (coal or oil/gas), base metals (copper, zinc, nickel), Platinum group metals, chromium, vanadium, manganese, alumina-silicates.

  • Minerals for energy: coal, uranium (also limestone for washing emissions), natural gas, including shale gas and coal-bed methane gas.

  • Minerals for agriculture: NPK – nitrogen (gas), phosphates, potassium, conditioners (sulphur, limestone).

  • Minerals for Infrastructure: Steel (iron ore) cement (limestone, gypsum), copper.

State intervention with a focus on beneficiation for industrialisation is urgently required. Instruments are required to support beneficiation and competitive pricing of these strategic resources include the use of targeted management of exports of minerals. In addition, SA’s share of some resources offers possible producer power which could be used to facilitate backward and forward mineral economic linkages.”

Government has completed downstream mineral value chain strategies on ferrous minerals (iron, manganese and chromium), the PGMs (platinum & palladium), polymers (from coal or gas) and titanium. These strategies have been incorporated into the 2014/5 IPAP.

The MPRDA Amendment Bill should cater for a minimum local content procurement spend, a minimum local STEM skills development spend and a minimum local RDI spend. The DTI is engaging with the DMR on this.

The DTI is engaging with both the DTI and the DST to rebuild national mining technology development (RDI) capabilities, since the demise of COMRO/Miningtek, to support the growth of the upstream minerals sector.

Strategic Minerals

The MCETR identifies key feedstocks into manufacturing, infrastructure, energy and agriculture as being “strategic” (steel, polymers, copper, cement, coal/gas, NPK, et al) and requiring state intervention on domestic pricing. The MCETR also identifies as strategic minerals that offer “producer power which could be used to facilitate backward and forward mineral economic linkages” (MCETR 2012).

The key interventions in this regard include:

• The MPRDA amendment bill to include a method for designating strategic mineral feedstocks and for their domestic developmental pricing.

• The MPRDA amendment bill to include state control over the marketing of select minerals to realise potential producer power to enhance their economic linkages in SA.

• The MPRDA amendment bill to include the public tender of all known unencumbered mineral assets, against the fulfilment of the state’s developmental goals (developmental pricing, local content, beneficiation, transformation, STEM skilling, technology development, et al)

Establishment of a Metals/Commodities Exchange Mechanism should be explored given that South Africa In its favour South Africa has a legal infrastructure that can support an exchange, well established and functioning credit systems, good financial regulation, sufficient financial resources and banking skills and, in the Rand Refinery, a world-class gold depository.

Further benefits include the enhancement of the host country’s financial infrastructure, better standards of financial regulation, knock-on benefits for the economy from both of these, a direct economic benefit from the exchange providing employment and investment, and, finally, prestige for the host country and city.

The prognosis for a South African commodity futures exchange has prospects of improving only once a cash or physical market for the commodities has evolved locally. While these commodities are exported to the exclusion of the local market, as is currently the case, a physical or cash market will have enough difficulty establishing itself let alone providing the grounding for the evolution of a viable futures market.

OIL AND GAS

Oil and gas resources are emerging as another potential game changer in South Africa. It is critical that the movement understands the political economy of the entire oil and gas industry, to ensure an appropriate political response is provided to shape its development in the interest of our people just as is aptly articulated in Norway’s “10 Oil Commandments” policy.

Acceleration of oil and gas exploration including shale gas exploration and coal-bed methane (CBM) can only be successful through a comprehensive approach the upstream sector in the oil and gas sector.

• Focus on optimal development of the oil and gas regulatory framework (including the free carry) to facilitate development, up- and downstream beneficiation particularly on offshore have to be attended as a matter of urgency.

• With regards to shale gas, over and above enabling supply of energy, there is potential of further developing petro-chemical industries, enabling industrial expansion and also ensure competitive supply of chemical feedstock for which currently Sasol is a dominant monopoly.

• We need to develop an enabling local content policy for the sector (upstream beneficiation), to which we will integrate other transformational industrialisation initiatives such as the development of Black industrialists. The DTI’s formulation of a Resources Capital Goods Development Plan (RCGDP), should optimise synergies with the upstream oil & gas sector;

• We also need to develop an enabling downstream beneficiation policy for the sector that ensures that strategic products such as fertilisers, polymers and energy are supplied to our domestic industries at developmental prices;

• Strong and public focused support on stateowned entities and companies such as PetroSA (particularly), Central Energy Fund, SANEDI, Strategic Fuel Funds whilst drawing lessons on successful models and experiences from other countries is essential, as they should form the basis of the States participation in the sector. We should draw lessons from the weaknesses in the mining industry where the interests being served are for foreign owners. It should be noted that we have borrowed, with minor tweaking, a structure and focus on the energy-related SOC’s, designed for objectives of an isolated South Africa during apartheid that are different to the developmental and industrial objectives of a South Africa with the international relations of today.

• In this instance, we should review of the organisation, focus and approach of the oil & gas-related SOC’s. This review to take account of the need for a strong energy group that will take responsibility for the State’s participation in upstream oil & gas (National Oil Company activities), pipelines for gas whether from shale gas developments or from offshore fields, catalyst & partner for petro-chemical developments, security of supply including strategic storage and participation in renewable energy. Our recommendations on Mining & Minerals (above) should be incorporated into our Oil & Gas policies, where appropriate.

It is intended that all the above issues will be addressed by revising all legislative instruments related to the oil and gas sector and incorporating these into a standalone Oil and Gas Act. This sector is currently regulated through the MPRDA, which deals with both onshore hard rock mining as well as onshore and offshore oil and gas.

TOURISM

Another sector which holds great potential for job creation, especially in rural areas, is tourism. However, barriers to entry into the value-chains of the sector that are faced by SMME’s, Black-owned enterprises, particularly the youth and co-operatives need attention. We need to draw lessons on how to improve the integration of Black people, women, the youth, SMME’s and co-operatives into the tourism valuechain.

Advancing transformation in the tourism sector is paramount. The National Department of Tourism must continue to invest in skills training and entrepreneurship development, support the development of catalytic infrastructure in communities (including through its EPWP projects and incentives programme), and further leverage the sector’s BBBEE codes of good practice.

In 2012, the tourism sector represented 3% of our GDP and over 617 000 jobs. In addition, the tourism sector has exceptionally strong linkages to the rest of the economy, for example food and beverage production, financial services, printing and publishing, security services, and many others. If we add up all the indirect impacts, tourism generated 9.7% of South Africa’s GDP in 2013 – and supports more than 1.4 million jobs in the country.

There is also potential to unlock greater value by investing more in nurturing a culture of domestic tourism. By increasing government investment in tourism marketing, we could create meaningful new job opportunities and economic growth. Tourism represents a labour-intensive sector with a supply chain that cascades deep into the broader economy, and the multiplier for its contribution to GDP and job creation outstrips that of most other economic sectors.

TECHNOLOGY AND RESEARCH, DEVELOPMENT AND INNOVATION (RDI)

Building an economy requires quality and accessible research development and innovation (RDI) and persistent technological advancement, as well as appropriate support institutions. RDI has the potential to enable the economy to leapfrog over certain development hurdles in line with the spirit of Operation Phakisa.

In line with our historical resolutions, there is a need for assertiveness to ensure that government attains the target RDI expenditure of 1.5% of GDP. This requires better systems for allocating public funds for RDI. That includes a realistic assessment of which R&D activities are likely to produce economic benefits, rather than expending resources on increasing all possible categories of ‘research’. Focusing on a carefully selected high-impact areas that align with our industrialisation, beneficiation and modernisation policies, strategies and programmes. The lease of all state assets (e.g. minerals, EM spectrum, et al) should stipulate a minimum domestic annual RDI spend of at least 3% of value added. Likewise all major state procurement contracts should seek to strengthen our national RDI system.

South Africa needs to build new centres of excellence in RDI and enhance existing ones with the objective of producing original and potentially ground-breaking research and facilitating a growing community of scientists, engineers, technologists and industry experts, contributing to our Economic Transformation goals. Such development in RDI must be synergised with priority sectors of the economy.

The state should also upscale its support for RDI, and build partnerships with firms which have significant capacity to conduct in-house research and development of new technologies. This will require a review of existing institutions that make up the national innovation system, an assessment of the extent to which they are complementary, and an evaluation of their contribution towards supporting our development strategies under the NDP, the NGP and the IPAP.

SMMEs AND COOPERATIVES

We must continue to encourage the creation of new businesses, cooperatives and the expansion of small business, by reducing the costs of compliance with government regulations, making it easier for companies to ‘do business’ with government, making sure that government pays its invoices on time and strengthening the role of our development finance institutions.

Small and medium enterprises and co-operatives have a potential to create more job opportunities, particularly for the youth. The best way of taking investment opportunities to poor communities is by supporting SMME’s and Cooperatives in those communities. Once these SMME’s and cooperatives thrive, larger firms, such as banks, begin to open up services and economic activity improves. The strategy should be to promote SMME’s and Cooperatives in poor communities.

Greater empowerment and focused support to small business development and Cooperatives. In line with our commitment to place the economy at the centre stage and the deliberate decision to focus on small business and Cooperatives, government must unlock economic opportunities that will ensure inclusive economic growth and the creation of sustainable employment, particularly for women, youth and people with people with disabilities.

Our approach includes measures to reduce monopoly pricing and prevent collusion by dominant players in key product markets. Emphasis must be placed on easing regulatory burdens, support mechanisms which include; strengthening partnerships with stakeholders; access to finance, improving training and capacity building programmes, market access, and simplifying business registration processes. State procurement budgets will be leveraged to develop competitive local suppliers to ensure localisation.

A range of options may be considered, including non-procurement related policy tools that affect SMME’s and Cooperatives in more direct and transparent ways, to promote sustained growth and competitiveness. These include, for example, increased access to credit markets, input subsidies and/or technical and marketing support for finished products.

A big opportunity to make co-operatives work is for the state to adapt the procurement guidelines. The Preferential Procurement Policy Framework Policy (PPPFA) must be used and adapted to leverage the existing and future governmental spending, and support the development of local industries. Developing alternative value-chains that link cooperatives to school nutrition programme, hospitals, SOE’s and agencies should be amongst our flagship projects for empowering SMME’s and Cooperatives.

OCEAN ECONOMY

Our ocean is a national asset. We are determined to ensure that this asset becomes a key component of sustainable growth, generating benefits for all our citizens.

Recognising the enormous potential of the ocean in contributing to economic growth, creating jobs and reducing poverty, key Government departments must cooperate in enhancing the ocean economy in four new growth focus areas, namely marine transport and manufacturing, offshore oil and gas exploration, aquaculture and marine protection services and ocean governance.

The ANC will support and monitor the implementation of the initiatives within the four focus areas of the ocean economy. We need to urgently develop governance and a funding regime, in order to promote the implementation of ports infrastructure that will enable growth in support of marine manufacturing, offshore oil and gas industry in particular to take advantage of job opportunities for boat building, ship repairs and maintenance of oil rigs.

We need to provide support and direction in the development of ocean legislation, including protection of ocean resources and marine spatial planning in order to designate special economic use zones.

MONOPOLIES AND COMPETITION POLICY

The South African economy continues to be dominated by monopolies and oligopolies in strategic value-chains. Monopoly and cartel pricing directly undermines the growth of the economy by increasing prices of key products for downstream industry and those that are essential for low income consumers. In addition, tight knit insiders raise barriers to entry for new participants including black owned and managed firms, and lobby to protect their position through rules and regulations that favour incumbents. These have served to stifle the development of downstream, labour-intensive industries, small and medium-sized enterprises, cooperatives and Black-owned firms.

The genesis of the corruption that has become so endemic in our society in both public and private sectors presents itself in many forms including anticompetitive behaviour and collusion. Our people continue to suffer under the burden of high prices and our economy fails to adequately ensure equitable and broad based access to economic opportunities as a result of this anti-competitive and unscrupulous behaviour.

The competition authorities have identified such conduct but have not been equipped with enough powers to remedy such behaviour. Stronger steps need to be taken to address anti-competitive behaviour through competition enforcement, regulation and complementary policy measures. Regulators need to work much more closely with the competition authorities and consideration should be given to merging these institutions to increase their capacity as well as their powers.

In addition, other policy levers must be applied simultaneously to address excessive pricing by oligopolies supplying key industrial inputs.

PROCUREMENT AND STATE CONCESSIONS/LEASES

Government should intensify the use of public procurement and state concessions as a policy tool for economic development. In this regard, the state needs to incorporate procurement (local content) targets/ conditions, skills formation targets, BBBEE, SMME and Co-operatives targets/preferences, technology development targets and value addition targets into all public procurement and leases (concessions) of public assets or rights such as: mineral rights, fishing rights, electro-magnetic (EM) spectrum (ICT) rights, state land rights, water rights, national conservancies and heritage sites (tourism leases), energy generation rights (IPPs), air (aviation) rights, maritime rights, exclusive marine economic zones, etc.

INFRASTRUCTURE SECTORS

Energy: South Africa is confronted by a growing economy that is in need of ever more energy inputs. The need for investment in additional capacity to provide appropriate energy resources compels the exploration of various ways to secure the security of supply.

Transport: Transport systems are closely related to socioeconomic changes. The mobility of people and freight and levels of territorial accessibility are at the core of this relationship. Economic opportunities are likely to arise where transportation infrastructures are able to answer mobility needs and ensure access to markets and resources.

Information and Communications Technology: The world has become more connected, networked, and interdependent. At the centre of this interconnection is ICT. This sector is a key enabler of innovation and is a fundamental resource for a developing economy. It can open many avenues for growth and employment. There is a need for a comprehensive national approach to the deployment of the ICTs to modernize government, the economy and service delivery within the context of a national e-strategy and an integrated e-government policy. This approach must entail mobilizing all sectors of the South African society and in particular providing broad-based training to those segments of the population that require empowerment to connect to the new ICT environments.

TRADE AND REGIONAL INTEGRATION

Our trade strategy must integrate economic diplomacy through advancing the African Agenda, expanding regional and bilateral relations and creating opportunities for South-South Cooperation, leveraging our significant global diplomatic stature and coverage. There is immense reciprocity and symbiosis between trade and the political aspects of diplomatic relations, with latter contributing towards the strategic approach.

Our economic development is dependent on achieving equitable regional integration and the creation of a regional economic market. The SADC market has grown substantially over the last decade and regional GGP is now over $1trillion. The challenges include:

• Natural tendency of unregulated capitalist development which polarises growth in favour of larger more powerful countries, regions and vested sectoral interests.

• Poor and inefficient logistics infrastructure.

• Lack of integrated and mutually beneficial industrial, agricultural and infrastructure strategies.

• Failure to leverage public and private procurement expenditure to maximise intra-regional production and job creation. Government should focus its engagement in SACU, SADC and in other bilateral and regional fora to address these challenges and to realise the advantages of equitable regional economic integration.

INCOME INEQUALITY

Widening disparities in income, wealth, and opportunities have risen to the top of our concerns. We have focused on confronting inequality of opportunity, focusing on access to education and health and inequality in human capital, however much still needs to be done. Inequality of income is also a function of the distribution of economic assets and their rates of return.

Private wealth is not dislocated from the success of the economic system as a whole, the economy should not be seen as an abstract experience that distributes rewards to a few. The extent to which private wealth accumulation is viewed as not linked to socioeconomic context is problematic and poses challenges of sustainability and long-term stability.

The role of economic policy should therefore be to serve broader needs, including the need to redistribute and empower. Thus, economic interventions should be appraised in terms of how functional they are in relation to our goals of lifting up communities from poverty. We must place our human goals at the centre of our thinking in terms of the decisions we make daily, including our drive to deliver goods and services to our communities.

CONCLUSION

The overview of economic programmes and policies outlined in this report gives a clear indication of the extent and vibrancy of the interventions of the ANC-led government, informed by its vision of building a democratic developmental state in South Africa.

Much is being done, yet much remains to be done, and much can be done better, smarter and more effectively. It is through a constant review of our various programmes and our interventions that the ANC will most effectively calibrate its economic programme and will achieve its goal of radical economic transformation, a transformation that will have the effect of improving the lives of ordinary South Africans. The upcoming organisational discussions in the build up to the NGC, and at the NGC meeting itself, offer the ANC an important opportunity for reflection and renewal.