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Sona: Building a Resilient Economy with Bricks, Not Straw

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JIMMY MOYAHA: On Thursday, President Cyril Ramaphosa will deliver the State of the Nation Address [Sona]. In anticipation of that, we will explore what we might expect and consider leading up to the address.

As I mentioned earlier, our show will not air that day, but instead, we’ll have a special broadcast to build up to the Sona. We won’t have a chance to react until Monday, so today we’re having this conversation to prepare and discuss our expectations.

I’m pleased to be joined by Dr. Raymond Parsons from the North West University School of Business and Governance to delve into this topic.

RAYMOND PARSONS: Good evening! It’s always great to connect with you. What are your thoughts on the upcoming State of the Nation Address? I’d like to hear your realistic expectations, as well as what you hope to hear. Let’s start with your expectations for this year’s Sona.

RAYMOND PARSONS: Good evening. It’s crucial that business and market participants focus on the Sona, as it carries significant implications.

The current global and domestic economic conditions have taken on a newly heightened importance. This marks the first Sona addressed by President Ramaphosa to the Seventh Democratic Parliament, making it a pivotal occasion.

Looking at it from a business perspective, it’s essential that the Sona outlines how the government of national unity (GNU) intends to accelerate urgent economic reforms aimed at fostering job-rich growth, building on the progress made recently.

The Sona must introduce new dimensions to strengthen the efforts needed for a larger, more resilient economy.

However, we’ve also witnessed South Africa grappling with emerging global risks and opportunities over the past months.

The Sona must encompass necessary adjustments and strategies to tackle the shifting global landscape.

There are numerous strategies we could pursue; establishing a dialogue and fostering constructive engagement with our trading partners would be essential to navigate potential challenges and turn them into advantages.

A key aspect we wish to see addressed in the Sona is how to fortify the South African economy against external pressures.

This is vital, as the Sona must demonstrate insights and leadership regarding the internal and external challenges we face.

JIMMY MOYAHA: You mentioned the GNU earlier, and I’d like to delve deeper into that. As you noted, this is the first Sona under the coalition government—a government formed by multiple parties.

Is there an air of concern or apprehension in having to balance the different views of various parties from the president’s perspective? Or is this a moment for these parties to demonstrate that they stand united?

RAYMOND PARSONS: It’s essential to recognize that since the formation of the GNU after last year’s election, the reaction from markets and businesses has largely been positive. While there have certainly been challenges, the GNU has had to navigate its share of difficulties and will face ongoing tests.

However, it’s imperative to convey to the markets and businesses that we, as a GNU, are beginning to address these issues.

It’s worth noting that the previous medium-term development plan belonged exclusively to the ANC government.

Recently, the GNU has been developing its medium-term strategy, and it will be important to see how this integrates with the expectations outlined in the Sona regarding growth, unemployment, and inequality.

Therefore, the Sona must successfully articulate the next steps and improvements needed under the GNU, aligning with its commitment to promote job-rich and inclusive growth—something the markets and businesses are keen to observe.

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JIMMY MOYAHA: Dr. Parsons, I’d like to revisit something you mentioned earlier—specifically, Trump-proofing the economy. We’ve heard clear statements from Washington as well as responses from the Union Buildings and here in South Africa.

Will the State of the Nation Address be yet another chance to assert South Africa’s stance and clarify what we stand for? Is this a moment where the president can firmly make clear that outside influences won’t sway our direction?

RAYMOND PARSONS: Given the evolving global landscape, especially regarding the United States, I do hope the president will address these issues.

Thus far, I must commend the president for his balanced approach; he has emphasized engagement and sought more nuanced diplomatic strategies.

After all, we will be hosting the G20 summit, which will bring President Trump to South Africa.

The US Secretary of State will be visiting in two weeks, as well.

Moreover, next year, the US will take over the G20 presidency.

Read:
Trump’s warning on land expropriation
Musk’s pressure on Ramaphosa
Mantashe’s call to stand against developed world pressures

We must approach these matters wisely, clearly outlining how the GNU will tackle these challenges moving forward. It’s crucial to diversify our economy.

We should maximize our opportunities under the African Free Trade Agreement and BRICS as well.

To use a metaphor from the nursery tale of the three little pigs: the first pig built a house of straw and it was easily blown down by the wolf. The second built a wooden house, which was also destroyed. The third little pig, however, used bricks, and the wolf could not blow it down.

We need to construct our economy with resilience—’bricks’ representing our engagements and commitments within BRICS and beyond.

The reality is we must strengthen our economy to support the growth-friendly policies we’re dedicated to, as the best defense against external uncertainties is a robust economy with strong growth.

Consequently, both the Sona and the upcoming budget must convey a clear message to both our citizens and the international community: we are determined to prioritize South Africa’s economic interests and generate confidence to tackle the challenges of the upcoming year in 2025, which will undoubtedly be tumultuous.

JIMMY MOYAHA: We must prioritize South Africa. It’s time to take decisive action, and the forthcoming State of the Nation Address is the perfect opportunity to do just that.

Thank you, Dr. Parsons, for your valuable insights. Dr. Raymond Parsons from the North West University School of Business and Governance has shared his thoughts and anticipations ahead of the State of the Nation Address scheduled for Thursday.

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