Nothing better illustrates the oleaginous political skills of President Cyril Ramaphosa than the effortless way, in his state of the nation speech on Thursday, he glided over the small problem of Eskom backtracking on its agreement to yield control of trsmission lines as the central pillar of electricity market reform.
Eskom is supposed to be handing over the entire network to a new national transmission operator that will buy power from it, or from private generators, depending on price. But Eskom, heavily indebted, fears the coming competition, and while it conceded the creation of the new market operator, it and electricity minister Kgosientsho Ramokgopa have dug in their heels on asset transfers.
Ramaphosa appeared to be having none of it. “We are restructuring Eskom and establishing a fully independent transmission entity,” he insisted. “This entity will have ownership and control of tranmission assets and be responsible for the electricity transmission market.” Cue wild approval from the media and big business.
But then came the schlenter. “I have established a dedicated task team,” he said, “under the National Energy Crisis Committee, to address various issues relating to the restructuring process, including clear timeframes for its phased implementation.”
The “phased” is deliberately unclear. I remember Ramaphosa joking that Covid lockdowns would not last the year, but “I’m not saying which year”, and this has that feeling about it. He does literally nothing without first squaring the politics.
The entire speech was like this. He made, typically, dozens of promises, none of which is yet even remotely funded, and some of his bragging was childish. “Our economy is growing again, and that growth is gathering pace,” he said in a storming introduction. Except it isn’t. Duma Gqubule, who has these numbers at his fingertips, reminded us that GDP growth in the last four quarters has been 0.4%, 0.1%, 0.9% and 0.5%.
Ramaphosa’s state of the nation address hit all the right notes but the ANC choir sings a different tune
“The rand has strengthened against the dollar,” the president continued. Yes, but so has almost every currency in the world. “The Johannesburg Stock Exchange has performed exceptionally well over the past year” — ditto for equities the world over.
The army is to be deployed to help police fight gangs and illegal mining in the Western Cape and Gauteng. “We’re not playing,” said deputy defence minister Bantu Holomisa after the speech; you point a gun at a soldier at your peril. How will this work though in the jam-packed townships around Cape Town where there’s always a kid or a mom on the streets? The British put the army into Northern Ireland to help police maintain peace between Catholics and Protestants in 1969 and the troops stayed for 37 years.
Ramaphosa said water problems in big cities and rural areas were due to poor planning and poor maintenance, but then said there were no easy fixes, such as, for instance, better planning and maintenance. He would personally chair a whole new crisis committee to look into it.
And he warned failing municipalities that if they couldn’t fix themselves, then he’d find someone else to fix them — ironically making the argument for asymmetrical provincial devolution. Provinces that can efficiently run health or education or transport should be encouraged to do so, while those that can’t — the Eastern Cape comes to mind — should have the competencies removed.
The government and the business elite are working hard to convince us that South Africa, driven by Ramaphosa’s reforms, is on the cusp of a new era. But I just can’t see it, let alone feel it. For a start, almost everything depends on Ramaphosa remaining in office at least until 2029. Behind his back, his party is resentful and divided on reform.
He may well stick around and the GNU may well be better than the alternative, but this is still a country run by people determined to keep the state at the heart of the economy. So they’ll go on endlessly about the new “green economy” while renationalising the old Iscor steel business to save unionised jobs and defend “inclusion” over growth. They’ll go on endlessly about the private sector being allowed onto the rail network, but that won’t happen for years yet.
Mining is run by an almost medieval minister and we haven’t sunk a new shaft in more than a decade. BEE rules on inward investment are without question a barrier to it, and we are light years away from fixed investment levels north of 25% of GDP that would make a serious dent in unemployment.
Despite all the hype and promises, manufacturing production in this country fell last year by 1.3%. Little wonder — electricity price inflation has passed 1,000% for the last 20 years. I printed the president’s speech out but for my records only. Most of what he promised is just impossible while his blinkered party is in power.
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