CAPE TOWN – South Africa faces “tough decisions” to boost economic growth after years of stagnation, new President Cyril Ramaphosa in a State of the Nation address on Friday a day after his inauguration.
In a speech aimed at both global markets and the core supporters of the ruling African National Congress (ANC), the former union leader promised to transform the mining sector, fight corruption and speed up the redistribution of land to black citizens.
Ramaphosa said his government was committed to “policy certainty and consistency”, in contrast to his scandal-plagued predecessor, Jacob Zuma, who was criticised for policy shifts and unpredictable cabinet changes that rocked domestic financial markets and confounded investors.
The 65-year-old was sworn in as head of state on Thursday after Zuma reluctantly resigned on orders of the ANC.
Ramaphosa’s election as president, which was unopposed in the parliament, has prompted a wave of optimism among South Africans hungry for change after nine years of economic stagnation and corruption scandals. Zuma denies all wrongdoing.
“Tough decisions have to be made to close our fiscal gap, stabilise our debt and restore our state-owned enterprises to health,” said Ramaphosa in his speech, adding that the creation of jobs was a priority in his agenda for 2018.
Ramaphosa said mining had potential for growth and jobs.
“We need to see mining as a sunrise industry,” he said.
South Africa’s mining industry has been a major employer and contributed 7.7 percent to gross domestic product in 2016. The sector also accounts for 25 percent of exports in Africa’s most industrialized economy. South Africa’s GDP is estimated to grow by around 1 percent this year.
South Africa’s rand rallied soon after Ramaphosa started his speech, trading near its three-year best.
Financial markets have rallied since Ramaphosa took over from Zuma as ANC leader in December, as investors warmed to his pledges to straighten out the country’s struggling state-owned enterprises and woo overseas investment.