14 November 2011

South Africa’s National Development Plan seeks to create a “virtuous cycle of growth and development” by removing the most pressing constraints to investment and job creation in order to eliminate poverty and sharply reduce inequality in the country by 2030.

The wide-ranging draft plan, which will be refined through public engagement before going to Cabinet, was presented to President Jacob Zuma by Trevor Manuel, chairman of the National Planning Commission, in Pretoria on Friday.

11-million new jobs by 2030

The plan builds on the government’s New Growth Path, which targets 5-million new jobs by 2020, setting an ambitious target of reducing South Africa’s unemployment rate from 27 percent in 2011 to 6 percent by 2030 by creating 11-million new jobs.

This will require meeting the corollary target of annual average gross domestic product (GDP) growth of 5.4% between now and 2030, and the National Development Plan focuses strongly on economic interventions to achieve job-creating growth.

However, its scope is much wider than that, ranging from improving the country’s infrastructure while integrating the rural economy and transitioning to a lower-carbon economy, to improving the quality of education, achieving quality universal health care, building safer communities, reforming the public service and beating corruption.

‘South Africa needs to write a new story’

At its heart, the plan envisages a shift away from a paradigm of entitlement to a paradigm that promotes the development of capabilities, the creation of opportunities, and the participation of all citizens.

“To make meaningful, rapid and sustained progress in reducing poverty and inequality over the next two decades, South Africa needs to write a new story,” the plan states.

“At the core of this plan is a new development paradigm that seeks to involve communities, youth, workers, the unemployed and business in partnership with each other, and with a more capable state.

“The aim is to develop the capabilities of individuals and of the country, and to create opportunities for all South Africans.”

An economy that will create more jobs

To increase both employment creation and economic growth, the plan proposes:

• • Raising exports, focusing on those areas in which South Africa already has endowments and comparative advantages, such as mining, construction, mid-skill manufacturing, agriculture and agro-processing, tourism and business services.

• • Increasing the size and effectiveness of the country’s innovation system, and ensuring closer alignment with companies that operate in sectors that fit in with the growth strategy.

• • Improving the functioning of the labour market to help the economy absorb more labour, through reforms and specific proposals concerning dispute resolution and discipline.

• • Supporting small business through better coordination of the activities of small business agencies, development finance institutions, and private and public incubators.

• • Improving the country’s skills base through better education and vocational training.

• • Increasing investment in social and economic infrastructure in order to lower costs, raise productivity and bring more people into the mainstream of the economy.

• • Reduce the regulatory burden in sectors where the private sector is the main investor, such as broadband internet connectivity, to achieve greater capacity and lower prices.

• • Improve the capacity of the state to effectively implement economic policy.

“Long-term growth and investment requires trust and co-operation between business, labour and government,” the plan states – while noting that trust levels in South Africa are low, and labour relations “unduly tense and sometimes violent”.

The economy will never evolve in a more labour-intensive manner if this state of tension between employers and employees persists, the plan warns.

“Promoting more rapid, job-creating growth means tackling these tensions in an honest and open manner.”

‘Must talk directly to the needs of our people’

In receiving the plan, President Zuma commended the commissioners for putting the elimination of poverty and reduction of inequality at the heart of their plan.

“These two challenges, plus the need to eliminate illiteracy, are the ones that most South Africans feel most strongly about. Any plan that fails to talk directly to the needs of our people … will not be good enough for our country.”

The President was also pleased that nation building and social cohesion had been identified as critical for the achievement of the plan’s objectives. “It is essential that we capture the balance in our Constitution to build a prosperous, non-racial, non-sexist and democratic South Africa,” he said.

Minister for Planning in the Presidency Trevor Manuel said all South Africans needed to work together with the government, business and civil society to make the plan a reality.

“While the state can build schools, we need communities to ensure that the schools work properly and that children study hard. Our paradigm is one where communities are active in their own development,” Manuel said.

Deputy President Kgalema Motlanthe said he appreciated the commissioners’ bravery in acting upon the mandate given to them by the President of taking a broad, cross-cutting and independent view of South Africa in drafting the plan.

SAinfo reporter and BuaNews

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