Hon Chairperson, hon Minister of Economic Development and other Ministers present, hon Members of Parliament, captains of industry, comrades and friends, I greet you all. As we debate this Budget Vote today, it marks 57 years of the Freedom Charter, which envisioned that there shall be security and comfort and that people shall share in the wealth of the country.
Since the beginning of the economic recovery, the country has done very well to put systems in place to weather the remains of the storm of the last recession and rehabilitate the economic driving forces to create a better South Africa for all. It is for this reason that the New Growth Path has set out new, clear goals and targets to create job opportunities for millions of South Africans in order to improve household income and better livelihoods.
We acknowledged the steps taken by our government and social partners to formulate their commitment in the area of skills development by negotiating and concluding the National Skills Accord, which is Accord 1 of the New Growth Path. Our responsibility today for a better future tomorrow is to share strategies of giving and to achieve meaningful implementation of all the systems in order to ensure the sustainability of all the job opportunities that have been created. We also need to give and present statistics of labour absorption in each economic sector, which will give us an idea of what progress other sectors make.
We can safely say that the expected performance and outcomes in the key priority areas are being achieved, because we have seen a huge increase of employment opportunities in all areas in the economy that are led by our government. In defining the New Growth Path, four challenges stand out: Firstly, as the National Development Plan points out, sectors that are necessary for long-term growth and economic diversification are often not able to generate employment on a larger scale. In particular, advanced manufacturing is critical for long-term development but does not directly create much employment. We need more decisive action to identify which sectors we will support and ensure that, taken together, our interventions to diversify the economy will indeed achieve our aims for both growth and employment creation.
Secondly, since 1994, our economy has been characterised by large-scale short-run capital inflows into equity and bond markets. These inflows are larger relative to GDP in South Africa than in any other middle-income economy. They have made it easier and cheaper for government and state- owned enterprises to borrow money for investment, especially in infrastructure. They have reduced the price of imports, which holds down inflation, but they have also strengthened the value of the rand, which in turn makes it harder for South African producers to export and compete with imports. Moreover, many of the imports have been relative luxuries, since the very rich dominate consumption, because incomes are so unequal. The question becomes whether or how we can manage the situation better.
Thirdly, we need to restructure the economy without undermining its current strengths. This involves difficult choices. For instance, should we invest more in core economic infrastructure such as roads and rail from the coast to Gauteng, or maintain roads and electricity in the metros, or should we invest to improve living standards in the former Bantustans? Should we look for new investors in mining in order to open new opportunities for black entrepreneurs, or should we go with the experienced existing companies? Should we cut down on pollution even when it means closing companies? All too often, this kind of decision has been made without clearly understanding the consequences.
Fourthly, past inequalities in education, training and experience continue to dog decisions into the future. While improving education and training will certainly support employment creation and equality, they are not sufficient in themselves and, in any case, will not deliver soon enough for most of our people.
We rather need to find ways to improve economic opportunities for the labour force that we have. Most workers today have a sound secondary education, although relatively few have university degrees. We need to expand production that can use their skills, even as we develop systems to ensure that all South Africans have opportunities for life-long learning.
We will be guided by an industrial strategy and a corresponding programme that continually identifies and addresses constraints to investment. This will help to build an economy that is characterised by high levels of manufacturing activity, modern services, expanding trade, cutting-edge technology and a vibrant small business sector - all designed towards a labour-absorbing economy.
To ensure that benefits of growth are shared by all, the focus on creating decent jobs and ensuring an improved quality of life for workers will be central. These include skills development; specific attention to industries that lend themselves to involvement by marginalised communities; access to microcredit and small business assistance; land reform; public works projects; and promotion of sustainable livelihoods at community and household levels.
Comrade Smuts Ngonyama, I am very disappointed, Xhamela, that during these few years away from the organisation, you have become a pessimist. [Laughter.] When we talk about an engagement, you say it's an attack. [Laughter.]
I was not expecting that. I know who said, "huh-uh". [Interjections.] [Laughter.] Of course, he does not understand how the ANC works. The ANC will always protect the interests of the public when it comes to the Walmart issue. I believe the other problem is because you did not attend the strategic planning session where we discussed all these issues.