Home News Zuma hailed for $40 billion railway, port scheme

Zuma hailed for $40 billion railway, port scheme

Published on 10/02/2012

President Jacob Zuma won plaudits Friday for his proposals to shore up South Africa's economy and create jobs with a $40 billion building spree to overhaul the nation's infrastructure.

His State of the Nation address to parliament, televised nationally on Thursday evening, laid out plans for the national logistics company Transnet to lay new railways and upgrade ports to connect key mining regions to overseas markets.

The weekly Mail&Guardian said Zuma “delivered one of his better State of the Nation speeches since taking office in 2009.”

“The speech, while barren of any poetry or great quotes, was strong on detail and provided a sense of the earnestness and planning being put into efforts to unlock economic potential and create jobs,” it said.

The speech firmly embraced the notion of South Africa as a “developmental state” where government guides the economy, brushing off calls from his own party’s more radical ranks to nationalise mines and other key sectors.

“Trying to attract investment in mining puts an end to the nationalisation debate,” wrote Mike Schussler, the chief economist at Economists.co.za, a research house.

Zuma also touted the nation’s jobs performance, as the unemployment rate eased to its lowest level since the 2008 recession — even though South Africa has yet to regain the one million jobs lost during the crisis.

But Business Day editor Ellis Mnyandu said the drop from 25 to 23.9 percent “is hardly worth shouting about, considering that the expected 3.1 percent growth in gross domestic product for 2011 is way below the seven percent pace needed to soak up millions of jobless South Africans, particularly youths.”

Lindiwe Mazibuko, parliamentary leader for the main opposition Democratic Alliance, said the 300 billion rand spending spree was “very ambitious.”

“My shadow finance minister tells me it’s about 300 billion rands short. How it’s going to be funded is a mystery,” she said.

“It’s politically beneficial for the president, but the public sector wage bill is so high it’s just not clear where the money is going to come from.”

Those details are expected to emerge in two weeks, when Finance Minister Pravin Gordhan presents the national budget to parliament.

Much of the newspaper coverage was devoted to the lighter side of the opening of parliament, a spectacle that showcases the nation’s varied fashion sense, given bigger play on the front page of The Star than the speech itself.