THE SOUTH AFRICAN STATE OF THE NATION IN CHAOS: THE WALK FALLS SHORT OF THE TALK. GROWTH IS IN TATTERS AND THE FINANCE MINISTER FAILED TO DELIVER A CREDIBLE 2015 BUDGET ADDING TO THE MISERY OF THE PEOPLE
Journal Title: European Journal of Business and Social Sciences - Year 2015, Vol 3, Issue 12
Abstract
The paper looks at the chaos in the state of the nation address delivered by the South African State President on the 12th of February, 2015 in Parliament, in the city of Cape Town. There was chaos in Parliament which tarnished the image, reputation and demeanor of the country both locally, but more importantly on the international stage. This chaos is discussed very briefly, in the introduction of the paper and has a direct bearing on the South African budget which was presented by the new Finance Minister on 25 February, 2015. The paper alludes to the reality, given the lack of direction by the State President, in terms of his announcements on government policies. Thus, we find that, the Minister of Finance failed to deliver a credible budget, stave of internal and international criticism and therefore, there was a mismatch between the President’s State of the Nation address and the budget presented by the Minister. In a paper published in January, 2015 by the authors in the European Journal of Business Studies, in Switzerland, Volume (7) 13, (This journal) the paper drew attention to South Africa’s economic woes, outlining the problems and challenges that confront the minister and the nation. It argued that the Minister of Finance must be given a chance. However, this chance has gone awry, on the basis that the State President did not charter an acceptable understanding of the economy in his 2015, State of the Nation address, and fell short of the necessary walk that was required because, it was more talk, signifying nothing. Given the state of chaos in the South African economy, the inability of the government to deal with rising unemployment, increasing poverty, widening inequality, a lack of land distribution to the poor, overt amounts of corruption at all levels of the government and bureaucracy, increased service delivery protests, the decline of the rand as a currency on the world market, the dysfunctional municipalities, rising food prices, very slow GDP growth exacerbated by both power (electricity) and water shortages in the country, which is expected to go on for at least three to five years, puts paid to a much needed growing economy; a dysfunctional public health and education systems, slow agricultural growth, a bloated inept and inefficient bureaucracy, a unsustainable social grants policy, escalated borrowing bringing about an increased debt burden. The budget presented negates development imperatives, retards growth and, was not a pro – poor budget. In fact, South Africa as a country is injured and reeling in all sectors of the economy. Escalating crime rates has a negative impact on the economy. The situation is so bad that, it is almost on the brink, reaching a rapid tilting point of no return, and these are very serious concerns. It could very easily be downgraded by rating agencies in the near future, as an economy in the category of junk status. In other words the South African government, its ruling predatory elite and the public service bureaucracy to a large extent have lost their moral compass and, failed the country. In his mid – term budget in November of 2014, setting the tone for the actual full budget that was tabled in February, 2015, growth was adjusted from 1.6 percent to 1.4 percent. It appears that this growth will have to be further adjusted downwards by the Minister of Finance, because of a lack of direction by the President and his Cabinet. The growth is now set at 2 percent as was announced. In actual fact the 2 percent growth is wishful thinking and pie in the sky, because the South African economy will most certainly contract and decline even further. The paper will only give some of these issues a brief analysis because a host of these issues are not the concern of this paper. What is of concern is to analyze successive State of the Nation addresses by the President and then subsequently to analyze the South African Finance Ministers 2015 budget, to determine, if South Africa can be pulled out of the economic doldrums. Key Words: Chaos, State of the Nation, Growth, Budget, Water, Electricity, Economy, Gross Domestic Product, Inflation, Land Reform.
Authors and Affiliations
Anis Mahomed Karodia (PhD)| akarodia@regent.ac.za Professor, Senior Academic and Researcher, Regent Business School, Durban, Republic of South Africa, Dhiru Soni (D. Phil)| Director of Research and Innovation, Regent Business School, Durban, Republic of South Africa, Joseph E. David (PhD)| Former City Administrator at the Ethekwini Municipality (Durban), Researcher and Academic, Regent Business School, Durban, Republic of South Africa
Keywords
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