Unveiling the mini budget, it is expected that Finance Minister Pravin Gordhan’s speech will again catch the attention of the financial markets along with some adjustments that will accomplish the same as the government’s economic and fiscal policies.
All will be looking with full attention on Gordhan, when he will walk into the Parliament to declare his last Medium Term Budget Policy Statement of the current administration, before Parliament today.
The mini budget will be in concern of inactive growth according to the Reserve Bank, has been brought about labour unrest and domestic production stoppages.
Inspite of these challenges, it is not expected that Gordhan would make comprehensive announcements, but will concentrate to his vision of victory by implementing National Development Plan (NDP) - the government’s vision to completely abolish poverty, improve quality education, health care, create jobs and bulk investments in the infrastructure.
In 2009 when Gordhan for the first time walked into the Parliament to present his mini budget, in the rule of Jacob Zuma administration, times were rather stiff.
South Africa along with the whole world had suffered from a dark period of recession in which around 1 million South Africans lost their jobs.
At that time the main aim of Gordhan was take immediate steps to cure the poor condition of job loss which included teaching new skills to the workers and increased support to the industries that were affected.
The exports were also seen moving towards the ground due to the ongoing crisis and the economic outlook being improved due to the global decline. He saw that there is a need of moving government’s focus to the powerful infrastructure investment to overcome the recession period. This makes the borrowing necessary.
Gordhan also announced severe measures instructing the government to avoid wasting money on unnecessary occasions and take serious steps against corruption.
He also told Parliament that there was a need of review and understand how actually the government is working, starting right from increasing service delivery to fiscal policy reforms.
Looking back in 2011, the NDP, chaired by Minister in the Presidency Trevor Manuel, produced the NDP- the country’s view that set out to strongly deal with structural economic challenges due to the apartheid policies.
This plan has now implemented as a policy with the aim of tighten the municipal finances and invest in the urban infrastructure, promote special economic zones for industrial and export opportunities, increase the job opportunities for the youths and improve the living conditions in simple settlements, including mining communities.
It will also include increasing the exports from the country especially to the emerging markets, and make people aware about the real investment opportunities in Africa.
His 2012 mini budget focused on the NDP priorities and their effect and describe the situation for his main budget announcement in February.
Gordhan earned a lot of respect due to the progress made by him, and how he brought confidence in the emerging markets through partnerships with the emerging economies like Brazil, Russia, India and China - known as BRICS. He has been awarded with the tag of Sub-Saharan Africa's Finance Minister of the Year because of his true dedication in changing the situation.
SA is an active member of the G20 major economies and recently after the meeting in Russia, G20 leaders signed a St Petersburg Action Plan that selected South Africa to “centralize the prudential supervision of financial institutions, improve the protection measures of financial consumers and increase the scope of regulation to include credit rating agencies…”
The cabinet having already approved policy granting black-listed consumers credit amnesty, lets wait and watch what other new announcements Gordhan will make today.
