BLSA’s Mavuso calls for urgency in implementation of economic recovery plan

21st September 2020 By: Simone Liedtke - Writer

South Africa’s move to Alert Level 1 in the Covid-19-induced lockdown is “the right one”, as this means that more of the economy can function, and “more people can get back to work”, says Business Leadership South Africa (BLSA) CEO Busi Mavuso.

In her weekly newsletter on September 21, Mavuso comments that reopening the borders in time for the peak tourism season will help “the decimated hotels and leisure industry” to start to recover, marking the first step in South Africa’s recovery process.

She, on behalf of the BLSA, also urges authorities to provide travellers with full clarity on the requirements for them to visit the country.

“As we learnt with the debacle over children’s birth certificates, hassle and confusion quickly render South Africa uncompetitive in the global tourism marketplace,” Mavuso laments.

She also applauds President Cyril Ramaphosa’s move to return all public servants to work to ensure all areas of government resume full operation, a critical move as the State’s services are essential for the economy to function, including the issuance of licences, registrations and so on.

However, in referring to “what still must be done”, Mavuso highlights the recovery plan, saying it “is not enough to simply remove the constraints of lockdown and expect the economy to go back to normal”.

“It has been dealt a massive shock, the largest most of us have seen in our lifetimes. Many jobs have been lost in the six months since the lockdown began. They will not magically reappear,” she states, though she comments that the support from government to shield people from the worst of the economic impact, particularly through the Unemployment Insurance Fund (UIF) support package and social grant top-ups.

Considering that this support can only ever be temporary, Mavuso says the only way to get jobs back is through reforms that would allow the economy to grow and to find new ways to work in the post-pandemic world.

Social partners have recently agreed on a economic recovery action plan, which was submitted to the President and Cabinet. Approval is expected soon.

“While all such documents are the result of compromise in some respects, it was striking how much we, as business, could agree with our other social partners. We know, for example, that real structural reform must be done. Issues like energy security and increased radio spectrum availability will help the economy,” she comments.

These and several other issues were agreed on and Mavuso believes that what was agreed on will considerably advance South Africa’s economic potential.

However, she notes that the challenge now is for government to move with urgency.

“I hope we will, at long last, get to something that can really change our outlook. For years, the average South African became poorer as [gross domestic product] growth has lagged population growth. The Covid-19 crisis has dramatically worsened that trajectory. We needed reform before the crisis; now we need it more urgently than ever,” she stresses.