Giovedì, 11 Febbraio 2016 07:11 | Full speech: State of the Nation Address 2016

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Good evening, sanibonani, molweni, dumelang, goeie naand,lotshani, riperile, ndimadekwana,

Thank you for the opportunity to address Parliament andthe nation.

Today marks the 26th anniversary of the release ofPresident Nelson Mandela from prison,

which was one of the most remarkableepisodes in the history of our country.

It is also the 50th anniversary of the declaration by theNational Party regime that District Six would be a whites only area, leading tothe forced removals of more than 60 000 residents.

The year 2016 also marks the 20th anniversary of thesigning into law by Madiba, of the Constitution of the Republic. The signingtook place in Sharpeville on 10 December 1996.

We are proud of our democracy and what we have achievedin a short space of time. Our democracy is functional, solid and stable.


The Constitution, which has its foundation in the FreedomCharter, proclaims that South Africa belongs to all who live in it. A lot hasbeen done to promote inclusion and a non-racial society.

However, the journey to a non-racial society has not yetbeen completed.

The nation was shaken last month when racism reared itsugly head on social and electronic media, causing untold pain and anger.

There is a need to confront the demon of racism. HumanRights Day, March 21, will be commemorated as the national day against racismthis year. It will be used to lay the foundation for a long-term programme ofbuilding a non-racial society.

Compatriots, I would like to remind you of a few otherimportant anniversaries.

The year 2016 marks 60 years since the women’s march tothe Union Buildings to demand an end to the pass laws. We are happy to have inour midst Ms Sophie de Bruyn, who was among the heroic leaders of that historicmarch.

We also acknowledge the former President of the BlackSash, Ms Mary Burton. We acknowledge the organisation’s track record infighting for human rights, justice and equality.

This year also marks 40 years since the landmark June 16student uprising in Soweto.

We welcome the photographer who shot the famousphotograph of Hector Peterson carried by Mbuyisa Makhubu with his sisterAntoinette, Mr Sam Nzima.

We also salute the class of 1976 for their bravery instanding up against the brutal apartheid regime. We acknowledge one of theactivists of that era, the Deputy Secretary of Parliament, Ms Baby Tyawa, whois in our midst.

This year we also mark 30 years since the ambush andbrutal killing of the Gugulethu Seven by the apartheid police in March 1986.

The University of Fort Hare celebrates its centenary,which is a critical milestone in the liberation history of not only our countrybut the continent. The national celebrations will take place on the 20th ofMay.

Let me recognise uMntwana wakwaPhindangene, the leader ofthe IFP who is a former student of the university.

The year 2016 also marks the centenary of the battle ofDeville Woods in France, which took place during the First World War.

Scores of Black soldiers fought in the war but weretreated badly due to the colour of their skin.

A memorial that will restore their dignity and humanityis scheduled to be unveiled in July this year in France.

Compatriots, allow me as well to recognise three specialguests who are also with us today,

the chairperson of the National Church Leaders Forum andArchbishop of Cape Town, Archbishop Thabo Makgoba.

Archbishop Daniel Matebesi, the President of the NationalInterfaith Council of South Africa and

Bishop Zipho Siwa, the Presiding Bishop of the MethodistChurch of Southern Africa and the President of the South African Council ofChurches.

Madam Speaker and Madam Chairperson,

A resilient and fast growing economy is at the heart ofour radical economic transformation agenda and our National Development Plan.

When the economy grows fast it delivers jobs. Workersearn wages and businesses make profits.

The tax base expands and allows government to increasethe social wage and provide education, health, social grants, housing and freebasic services - faster and in a more sustainable manner.

Our economy has been facing difficulties since thefinancial crisis in 2008. We embarked on an aggressive infrastructuredevelopment programme to stimulate growth.

Our reality right now is that global growth still remainsmuted. Financial markets have become volatile. Currencies of emerging marketshave become weak and they fluctuate widely.

The prices of gold, platinum, coal and other mineralsthat we sell to the rest of the world have dropped significantly and continueto be low.

The economies of two of our partners in BRICS: Brazil andRussia - are expected to contract this year. The third, China, will notregister the kind of robust growth that it is known for.

Because our economy is relatively small and open, it isaffected by all of these developments.

Our economy is also affected by domestic factors such asthe electricity constraints and industrial relations which are sometimesunstable.

The IMF and the World Bank predict that the South Africaneconomy will grow by less than one per cent this year. The lower economicgrowth outcomes and outlook suggest that revenue collection will be lower thanpreviously expected.

Importantly, our country seems to be at risk of losingits investment grade status from ratings agencies. If that happens, it willbecome more expensive for us to borrow money from abroad to finance ourprogrammes of building a better life for all especially the poor.

The situation requires an effective turnaround plan fromus.

It is about doing things differently and also acting onwhat may not have been acted upon quickly before.

I will share a few points that we believe would make adifference.

First, our country remains an attractive investmentdestination. It may face challenges, but its positive attributes far outweighthose challenges.

We must continue to market the country as a preferreddestination for investments. This requires a common narrative from all of us asbusiness, labour and government.

If there are any disagreements or problems between us, weshould solve them before they escalate. This is necessary for the common goodof our country.

We have had fruitful meetings with business, includingthe high level meeting with CEOs on Tuesday this week.

We have heard the suggestions from business community onhow we can turn the situation around and put the economy back on a growth path.

We have heard the points about the need to create thecorrect investment support infrastructure.

Government is developing a One Stop Shop/Invest SA initiativeto signal that South Africa is truly open for business. We will fast-track theimplementation of this service, in partnership with the private sector.

Such an initiative requires that government removes thered tape and reviews any legislative and regulatory blockages.

We have established an Inter-Ministerial Committee onInvestment Promotion which will ensure the success of investment promotioninitiatives.

Compatriots, we have heard the concerns raised about theperformance of state owned enterprises and companies.

Many of our SOCs are performing well.

Sanral has built some of the best roads in Gauteng and inmany parts of the country. These make us the envy of many parts around theglobe.

The Trans Caledon Tunnel Authority has constructed damsof varied capacities, thus making it possible for our people to have access tosafe drinking water.

Transnet has built rail infrastructure which has enabledour country’s mines to move massive bulk of commodities through our ports tomarkets around the globe.

Eskom, in spite of the challenges, still manages to keepthe economy going, against all odds.

Our development finance institutions such as theIndustrial Development Corporation (IDC) or Development Bank of Southern Africaand others have provided finance for infrastructure, various industries andagricultural businesses without fail, even in the aftermath of the globalfinancial crisis.

For the state owned companies to contribute to thesuccessful implementation of the National Development Plan, they must befinancially sound.

They must be properly governed and managed. We will ensurethe implementation of the recommendations of the Presidential Review Commissionon State Owned Enterprises, which outlines how the institutions should bemanaged.

The Deputy President chairs the Inter-MinisterialCommittee which is tasked with ensuring the implementation of theserecommendations.

We have to streamline and sharpen the mandates of thecompanies and ensure that where there are overlaps in the mandates, there isimmediate rationalisation.

Those companies that are no longer relevant to ourdevelopment agenda will be phased out.

Government departments to which they report, will set theagenda and identify key projects for the State owned companies to implement,over a defined period. Proper monitoring and evaluation will be done.

These interventions are essential for growth and also forthe reduction of national debt levels.


We must take advantage of the exchange rate as well asthe recent changes of visa regulations, to boost inbound tourism.

SA Tourism will invest one hundred million rand a year topromote domestic tourism, encouraging South Africans to tour their country.

We have heard concerns from companies about delays inobtaining visas for skilled personnel from abroad. While we prefer thatemployers prioritise local workers, our migration policy must also make itpossible to import scarce skills.

The draft migration policy will be presented to Cabinetduring the course of 2016.

We have heard the appeals for policy certainty in themining sector, especially with regards to the Mineral and Petroleum ResourcesDevelopment Bill.

The Bill was referred back to Parliament last year. Weawait Parliament to conclude the processing, which we trust will be doneexpeditiously.


We need to empower SMMEs to accelerate their growth.Access to high-quality, innovative business support can dramatically improvethe success rate of new ventures.

The department of small business development wasestablished to provide such targeted support to small business.

Economic transformation and black empowerment remain akey part of all economic programmes of government. One of our new interventionsis the Black Industrialists Scheme which has been launched to promote theparticipation of black entrepreneurs in manufacturing.

We urge big business to partner the new manufacturersincluding businesses owned by women and the youth, as part of broadening theownership and control of the economy.


We are proud of our Top 10 ranking in the World EconomicForum competitiveness report with respect to financial services.

Maintaining and indeed improving our ranking is importantto our competitiveness as a country.

It is also fundamental to our ambition to become afinancial centre for Africa.

The banks, through the Banking Association of SouthAfrica, are to launch a project aimed at establishing a centre of excellencefor financial services and leadership training.

This will ensure that as a country we can attract,nurture, develop and retain the best talent in financial services in ourcountry and across our continent.

They will work with the Minister of Finance and theNational Treasury to get this done. We believe that this will over time ensurethat we can expand the pool of financial skills and broaden the jobopportunities for many young people.

This strategic project from the banking sector is apositive and encouraging outcome of our engagement with business this week.

Together we move South Africa Forward!


We have made an undertaking to spend public funds wiselyand to cut wasteful expenditure, but without compromising on the core businessof government and the provision of services to our people.

In 2013, the Minister of Finance announced a number ofcost containment measures. Excessive and wasteful expenditure has been reduced,but there is still more to be done to cut wastage.

I would like to announce some measures this evening.

Overseas trips will be curtailed and those requestingpermission will have to motivate strongly and prove the benefit to the country.

The sizes of delegations will be greatly reduced andstandardised.

Further restrictions on conferences, catering,entertainment and social functions will be instituted.

The budget vote dinners for stakeholders hosted bygovernment departments in Parliament, after the delivery of budget speecheswill no longer take place.

The Minister of Finance will announce more measures andfurther details in the budget vote speech on the 24th of February.

The executive management and boards of public agenciesand state owned companies must undertake similar measures.

I also invite Premiers of all nine provinces as well asmayors to join us as we begin eliminating wasteful expenditure withingovernment.

I trust that Parliament and the Judiciary will also bepersuaded to consider the implementation of similar measures.


A big expenditure item, that we would like to persuadeParliament to consider, is the maintenance of two capitals, Pretoria as theadministrative one and Cape Town as the legislative capital.

We believe that the matter requires the attention ofParliament soon.


We all have a lot to do to turn the economy around and tocut wastage. We will go through a difficult period for a while, but when theeconomy recovers, we will be proud of ourselves for having done the rightthing.


I would now like to report back on the undertakings madelast year.

During the State of the Nation Address in February 2015

I announced the Nine Point Plan to respond to sluggishgrowth.

The nine point plan consists of:

Revitalisation of the agriculture and agro-processingvalue-chain;

? Advancingbeneficiation adding value to our mineral wealth;

? More effectiveimplementation of a higher impact Industrial Policy Action Plan;

? Unlocking thepotential of SMME, co-operativess, township and rural enterprises;

? Resolving theenergy challenge;

? Stabilising thelabour market;

? Scaling-upprivate-sector investment;

? Growing theOcean Economy;

? Cross-cuttingAreas to Reform, Boost and Diversify the Economy;

Science, technology and innovation

? Water andsanitation

? Transportinfrastructure

? Broadbandrollout

? State ownedcompanies.

We have made significant progress in the implementationof the plan.

Progress has been made to stabilise the electricitysupply. There has been no load shedding since August last year which hasbrought relief for both households and industry alike.

Government has invested eighty three billion rand (R83billion) in Eskom which has enabled the utility to continue investing in Medupiand Kusile, while continuing with a diligent maintenance programme.

Additional units from Ingula power station will beconnected in 2017, even though some of them will begin synchronisation thisyear.

The multiple bid windows of the Renewable IndependentPower Producer Programme have attracted an investment of one hundred and ninetyfour billion rand.

This initiative is a concrete example of how governmentcan partner with the private sector to provide practical solutions to animmediate challenge that faces our country.

In 2016, government will select the preferred bidders forthe coal independent power producer.

Request for Proposals will also be issued for the firstwindows of gas to power bids.

The nuclear energy expansion programme remains part ofthe future energy mix.

Our plan is to introduce nine thousand six hundredmegawatts of nuclear energy in the next decade, in addition to running KoebergNuclear Power Plant.

We will test the market to ascertain the true cost ofbuilding modern nuclear plants.

Let me emphasise that we will only procure nuclear on ascale and pace that our country can afford.


Our government through the Department of Trade andIndustry introduced a number of incentives in the past few years to boostinvestments in the manufacturing sectors especially textiles, leather and theautomotive sectors.

Progress has been made in these sectors.

The incentives for the automotive sector have attractedinvestments of over twenty five billion rand over the last five years. Wewelcome key investments from Mercedes, General Motors, Ford, Beijing AutoWorks, the Metair group, BMW, Goodyear and VW.

The clothing and textile sector has also beensuccessfully stabilised after a difficult few years.

Multinational companies such as Nestle, Unilever Samsungand Hisense have also affirmed South Africa as a regional manufacturing hub.

They have retained and expanded their investments in newplants.

Indeed the progress made in manufacturing has certainlydemonstrated that the incentive programmes are effective and attractive toinvestors.


I announced programmes for the revitalisation ofagriculture last year. We introduced the Agri-Parks programme, aimed atincreasing the participation of small holder farmers in agriculturalactivities.

Construction has begun in at least five agriparks, whichare: Westrand in Gauteng, Springbokpan in North West, Witzenberg in WesternCape, Ncora in the Eastern Cape and Enkangala in Mpumalanga.

The agricultural programmes must empower women farmers aswell. Allow me to introduce the winner of the Female Entrepreneur of the Year2015, Ms Julia Shungube, from Nkomazi municipality in Mpumalanga.

Honourable Speaker and Chairperson,

Land reform remains an important factor as we pursuetransformation.

I spoke about the fifty/fifty policy framework last year,which proposes relative rights for people who live and work on farms.

Twenty seven proposals have been received from commercialfarmers and four are being implemented in the Eastern Cape and the Free State.

I also announced the Regulation of Land Holdings Billwhich would place a ceiling on land ownership at a maximum of 12 000 hectaresand would prohibit foreign nationals from owning land. They would be eligiblefor long term leases. The draft Bill will be presented to Cabinet in the firstsemester of the year.

We also announced the re-opening of land claims forpeople who had missed the 1998 deadline. The number of new land claims thathave been lodged stood at close to one hundred and twenty thousand as ofDecember last year.


As we are aware, five provinces have been seriously affectedby drought, namely North-West, KwaZulu-Natal, Free State, Limpopo andMpumalanga.

Government provides relief to affected communities.Isomiso sixakile impela ezifundazweni eziningi. Imfuyo iyafa kanti nezolimozisele emuva. Isikhathi esinzima lesi.

Uhulumeni uzoqhubeka nokuxhasa abalimi kanye nokusizaimiphakathi ngezimoto ezithwala zamanzi.

Let me take this opportunity to commend the civil societyinitiative, Operation Hydrate and others for the provision of water relief tomany communities in distress.

The building of water infrastructure remains critical sothat we can expand access to our people and industry.

The first phase of the Mokolo and Crocodile WaterAugmentation project in Lephalale area in Limpopo is fully operational. It willprovide 30 million cubic meters of water per annum.

The raising of the Clan William Dam wall in the WesternCape entails raising the existing dam level by 13 metres to provide additionalwater supply.

To curb water wastage, the Department of Water andSanitation has begun its programme of training fifteen thousand young people asartisans.

Madam Speaker

Madam Chairperson,

On improving labour relations, we welcome the agreementreached by social partners at NEDLAC on the principle of a national minimumwage.

Deliberations continue on the level at which the minimumwage must be placed.

It is important to emphasise that the national minimumwage should be implemented in a manner that does not undermine employmentcreation, the thriving of small businesses or sustained economic growth.

We are also encouraged by reports from NEDLAC that aframework to stabilize the labour market by reducing the length of strikes andeliminating violence during strike action is being finalized.

We have heard the concerns of labour about the TaxAmendment Act that I signed into law in December, following its passing byParliament.

Government is in discussion with COSATU about the matterand a solution is being sought.

Discussions are also on-going within government,led by the Department of Social Development and National Treasury, withregards to finalising the comprehensive social security policy.


Only a few years ago, our mining sector was in turmoilespecially on the platinum belt.

The situation has improved and we commend business andlabour for the progress made.

Another positive development in the mining sector was theLeaders’ Declaration to Save Jobs which was signed by mining industrystakeholders in August 2015.

We urge the parties to implement the agreement and tocontinue seeking ways of saving jobs.

We appeal to business again that retrenchments should notbe the first resort when they face difficulties.


In 2014 we launched the popular operation Phakisa BigFast results methodology and implemented it in the ocean economy, health,education and mining sectors.

Seven billion rand has been committed in new portfacilities, following the adoption of a Public- Private-Partnership model forport infrastructure development by Transnet National Ports Authority.

Compatriots, we were concerned that South Africa did notown vessels while we are surrounded by about three thousand kilometres of acoastline.

Through the oceans economy segment of Operation Phakisa,we are trying to solve this challenge.

I am pleased that two bulk carrier vessels have beenregistered in Port Elizabeth, and a third tanker in Cape Town under the SouthAfrican flag.

Another positive Operation Phakisa development has beenthe launch of a fuel storage facility here in Cape Town, bringing an investmentof six hundred and sixty million rand.

Aquaculture appears to be an important growth area withinthe oceans economy segment of Operation Phakisa.

Close to three hundred and fifty thousand rand privatesector investment has thus far been committed in the Aquaculture sector. Nineaquaculture farms are already in production. These farms are located within theEastern Cape, KwaZulu-Natal, Western Cape and Northern Cape.

We continue to promote innovation within the Nine PointPlan programme.

The Department of Science and Technology will finalisethe Sovereign Innovation fund, a Public private funding partnership aimed atcommercialising innovations that are from ideas from the public and the privatesectors.

Government will fast track the implementation of thefirst phase of broadband roll-out to connect more than five thousand governmentfacilities in eight district municipalities over a three year period.

Funding to the tune of 740 million rand over a three yearperiod has been allocated in this regard.


A lot of work was done in the social sector as well inthe past year.

Government has responded to the financial shortfallarising from the zero per cent university fee increase, as agreed in meetingwith students and vice-chancellors last year.

The Minister of Finance will provide the details ofeducation shortfall funding in the Budget speech.

I have appointed a Judicial Commission of Inquiry intohigher education. We urge all stakeholders to cooperate with the Commission andhelp ensure its success.

On the health front, the life expectancy of SouthAfricans for both males and females has significantly improved and is currently62 years across genders, which is an increase of eight and a half years since2005.

The HIV policy turnaround in 2009 led to a massiverollout of HIV testing and treatment for 3.2 million people living with thevirus.

This has contributed immensely to healthier and longerlives for those infected.

We acknowledge the contribution of partners in the SouthAfrican National Aids Council which is chaired by the Deputy President.

Our next step is to revive prevention campaignsespecially amongst the youth. The Minister of Health will soon announce a majorcampaign in this regard.

I am also happy to announce that the state-ownedpharmaceutical company, Ketlaphela, has been established. The company willparticipate in the supply of anti-retroviral drug to the Department of Healthfrom the 2016/17 financial year.

Meanwhile, the White Paper on National Health Insurancewas released in December aimed at improving health care for everyone in SouthAfrica.


Local government elections will be held within threemonths after the 18th of May, the date of the last elections.

We urge all citizens who are over the age of 18 toregister to vote during the first registration weekend, 5 and 6 March 2016.

We urge the youth in particular who are turning 18 yearsof age this year, to register in their numbers for this first ever opportunityto cast their votes.

Our Back to Basics local government revitalisation planwas launched in September 2014 and 2015 has been the year of intensiveimplementation.

In this second phase of implementation, nationalgovernment will engage in more active monitoring and accountability measures.

This includes unannounced municipal visits, spot checksof supply chain management processes, the implementation of recommendations offorensic reports, site visits of Municipal Infrastructure Grant funded projects,and increased interventions to assist struggling municipalities.

A 10 point plan of Back to Basics priority actions hasbeen developed to guide this next phase.

The plan includes the promotion of community engagement,which is absolutely critical to enable communities to provide feedback on theirexperience of local government.

I already undertook a walkabout at Marabastad taxi andbus rank in Pretoria on Monday to speak to informal traders and commuters.

The majority of complaints and issues raised related tomunicipal services.

They would like the Tshwane municipality to clean thearea and also to fix some broken sewerage pipes. Traders said they needed andwere prepared to pay.

They alerted me that many people in Elandspoort receiveRDP houses but instead of occupying them, they either sell them or rent themout other people.

Mrs Baloyi who runs a stall complained about nyaope drugaddicts who steal goods from traders.

Other commuters said I must visit Kwaggafontein in theformer KwaNdebele and see the lack of service delivery. I will visit the areasoon.

I was also able to speak to foreign nationals who saidthey queue daily to apply for documentation from the Department of HomeAffairs. We will continue to visit communities to hear their concerns and suggestions.Issues raised during the visit will be followed up by the respectivedepartments.


The South African Police Service is undergoing aturnaround and has adopted the Back to Basics approach to management to rebuildthe organisation and to improve performance at all under-performing policestations.

We note sadly, as well that fifty seven police officershave been murdered to date during the 2015/16 financial year. We condemn thiscriminality strongly.

We urge the police to defend themselves when attacked,within the confines of the law.


The African continent remains central to our foreignpolicy engagements.

South Africa continued to support peace and security andregional economic integration through participation in the African Union andthe Southern African Development Community initiatives.

We continued to assist sister countries in resolvingtheir issues for example in Lesotho and South Sudan.

The South African National Defence Force represented thecountry bravely and remarkably well in peacekeeping missions on thecontinent. We are truly proud of our soldiers. They will be showcasingtheir capability in Port Elizabeth from the 13th to the 21st of February, thecelebration of Armed Forces Day.

The Agreement by BRICS nations on the New DevelopmentBank or BRICS Bank came into force and the bank is envisaged to approve itsinaugural projects in April this year.

We participated in the India-Africa Summit as well as theForum on Cooperation between Africa and China as we strengthened theseimportant partnerships.

China announced investments of fifty billion US dollarsof which South Africa will receive ten billion US dollars for infrastructure,industrialisation and skills development.

On North-South cooperation, we continued our engagementswith the European Union as a bloc which is our largest trading partner andforeign investor.

Over 2000 EU companies operate within South Africacreating over three hundred and fifty thousand jobs.

South Africa’s relations with the USA and Canada continueto strengthen, especially in the areas of economy, health, education, energy,water, safety and security, capacity building and the empowerment of women.

The renewal and expansion of the African Growth and OpportunityAct (AGOA) provides a platform for the enhancement of industrialisation andregional integration. All outstanding issues around AGOA are being attended to.


We extend good wishes to all athletes who have qualifiedfor the Olympic Games to be held in Rio de Janeiro.

We encourage participation in several programmes aimed atpromoting healthy lifestyles and nation building.

These include the National Recreation Day, the NelsonMandela Sports and Culture Day; the World Move for Health Day, the Golden Gamesand the Andrew Mlangeni Golf Development Day.


A committee has been established to coordinate theparticipation of our performing arts legends in nation building activities inthe country.

The Living Legends committee is chaired by playwright MrWelcome Msomi working with music icon, Ms Letta Mbulu, as deputy chairperson.

We are also happy that musicians and actors amongstothers heeded our call to unite and have formed the Creative IndustriesFederation of South Africa. The Presidency has established the PresidentialCreative Industries Task Team to support our artists.


To achieve our objectives of creating jobs, reducinginequality and pushing back the frontiers of poverty we need faster growth.

In the National Development Plan, we set our aspirationaltarget growth of five per cent per year, which we had hoped to achieve by 2019.

Given the economic conditions I have painted earlier on,it is clear that we will not achieve that growth target at the time we had hopedto achieve it.

The tough global and domestic conditions should propel usto redouble our efforts, working together as all sectors. In this regard, it isimportant to act decisively to remove domestic constraints to growth.

We cannot change the global economic conditions, but wecan do a lot to change the local conditions.

Let us work together to turn the situation around. It canbe done.

I thank you.

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