Panel Discussion on party manifesto and broad economic questions hosted by the KwaZulu Natal Democracy and Election Forum - speech by Mr Bantu Holomisa, (UDM President) (24 March 2009, Durban)

Ladies and gentlemen,

Thank you for the opportunity to address you today. The UDM election manifesto is available on our website.

Before I turn to specific policy matters allow me to talk about the greater context in which this country operates.

One thing is certain, this country will after the elections have to make a concerted effort to recapture the lost ground of our international image. We are supposed to be the champions of NEPAD, which is underpinned by the ethics of good governance. Yet the ANC Government has not acted that way.
The recalling of a sitting President for petty reasons without even consulting the Parliament who elected him goes against the most basic principles of good governance. It damages our image even further when that bad decision is followed with the insistence that the new President will at all costs be a person who is facing numerous serious criminal charges.

Nor does it do much for our image when the National Commissioner of Police is charged with serious crimes for consorting with international drug dealers.

The latest fracas about the refusal of a visa for the Dalai Lama is another example of how our international image and our principles are being tarnished. The Dalai Lama and South Africa's own living Nobel Peace winners were to be the guests of honour at a 2010 World Cup event. He is renowned the world over for advocating peace as well as religious and racial tolerance.

The ANC Government claims that this peaceful man's presence would take attention away from South Africa's 2010 preparations.

Now it seems that their decision to prevent him from attending will take attention away from our 2010 preparations. It is a catastrophic failure of leadership on their part. Perhaps the ANC should come clean about how much their party has recently received in political donations or pledges from China.

South Africans are now forced to consider whether this Polokwane lynchmob is not morally and intellectually challenged.

Turning to the theme of today's panel discussion, South Africa has lost an opportunity in the past five to ten years to attract foreign direct investors in a big way. This was during a time when the domestic and world economy was expanding.

As we all know the country, even the Tripartite Alliance themselves, have never agreed on what sort of economic policy would be best.

Surely there would have been investors in the past decade who sought other shores when they noted the differences - even within the ruling alliance - on economic policy. That is not the way to create an environment that is welcome to investors.

Now the situation is worsening, because of the international economic meltdown. Countries and foreign investors are focussing inward now. Hence we hear that a country such as America is doling out trillions of dollars to prop up its financial sector. It could mean another long wait for international investors to return to our shores.

In the same period, the same government has failed dismally to accommodate the majority citizens of this country in the economic mainstream.

Even the so-called Black Economic Empowerment deals seldom translate into control and ownership. What we see mostly are black puppets or window-dressing.

For instance in Cape Town, Port Elizabeth, Durban or Johannesburg CBD areas you can hardly point to a property that belongs to a previously disadvantaged person or group.

Where I once governed, we may have accused the preceding Matanzima regime of many things, but one thing they did was to transfer property ownership to previously disadvantaged locals in all 28 towns. Sadly, today when I move about these towns I find that these shops and buildings belong to foreigners now.

Even those Africans who claim to have minerals and mining rights usually do not have access to proper finance; it means that they often sell these rights. There is no monitoring mechanism for this - so we don't even know to what extent so-called empowerment is not reversed by the recipients themselves.

These BEE deals have another weakness: they do not create new wealth. What we need is to expand the economy and create new business, new industries and new opportunities that are owned and managed by the masses that are currently locked out of the formal economy.

It is for these reasons that the UDM is calling for the Government to do more; to invest in the South African economy.

This is also why we believe it is imperative that the country should gather in an economic indaba - a CODESA type of forum. In such a forum all South Africans can identify inherent weaknesses in the current system and reach consensus on the broad pillars of economic policy.

So how does the South African economy measure up? It has strengths; our economy is diversified. We are rich in natural resources. We have a certain level of international goodwill that persists fifteen years after the first democratic elections. We have good diplomatic relations with every nation on earth and no current conflicts.

However, we have a number of weaknesses. We have a balance of trade deficit; our economy is extremely dependent on exports. At the same time we are incredibly dependent upon dollar-priced imports on vital commodities, not least of all oil and food. One of our economy's strengths is also a weakness; tourism plays an economic role and now it is in decline. We have a significant shortage of skills in the economy. We have an unemployment rate at 30%. We have an electricity grid that teeters on the brink of breakdown.
We also suffer from water-scarcity, a basic resource required for agriculture, industry and socio-economic development. We also have millions of people who continue to exist outside, or on the margins of the formal economy. Economists now agree that the South African economy is now in the first phases of recession.

We identified seven major issues in the UDM manifesto. The first and biggest priority in our manifesto is the economy and job creation.

Our proposals, we believe, are specifically geared towards addressing the global and local economic realities. The UDM argues that now more than ever Government must take the lead in stimulating the economy.

This can be done in a number of ways, some of which I will briefly list. A UDM Government will make it easier to do business by reducing unnecessary red tape, and providing tax incentives for businesses that create new jobs, especially small businesses. Small businesses are not only the surest way of creating real long-term jobs, it is also the most viable way to bring millions of excluded people into the formal economy.

The UDM argues that we must prioritise youth employment. The ruling party is creating another lost generation by failing to create the economic conditions for them to find jobs.

The people who should be in charge of every aspect of our society in fifteen years are today loitering the streets unemployed.

The UDM proposes a two-step initiative to address this. Firstly, specifically target matriculants and graduates to fill the many vacant positions in the civil service. In this manner we are addressing one of the root causes of poor service delivery as well. Secondly, the UDM proposes that Government must provide specific financial, tax and mentorship incentives for young entrepreneurs.

It is worth remembering that a certain Mr Rupert started out a young entrepreneur operating out of a home garage. The Ruperts of tomorrow, the ones that will grow our economy and create the jobs we need, are standing on street corners. They need only a little support and encouragement.

The UDM further proposes that infrastructure development must be accelerated. We are justifiably proud that Government adopted this policy after the UDM had been campaigning for it, for several years.

However the UDM believes that infrastructure development and maintenance still lags far behind what is required. The primary examples are electricity and water. But there are also serious deficits in most rural areas and informal settlements of everything from school and hospital buildings, to sanitation and housing. Part of this must be a deliberate effort to address the imbalance that exists between urban and rural infrastructure. In this regard agricultural development is vital. Not only will this stimulate the rural economy and create jobs, it will also increase South African household food security. The current cost of food, often dependent on imported prices, is causing great suffering in many households across the nation.

The UDM manifesto also argues for Government support by way of tax incentives for industrial development and manufacturing. We need to reduce our exposure to expensive imports, whilst increasing our exports. Therefore this incentive is aimed at adding value to our rich natural resources before we export them.

Our manifesto also argues that certain industries, such as agriculture and textiles require subsidy support to compete against highly subsided products in the international market.

In conclusion, I would like to highlight that I have focussed on our economic policy today, but the next two big issues in the UDM manifesto is Education and Fighting Crime. There is no doubt that we cannot build a fair and equitable economy without a proper education system. Nor can people be productive if they are not safe from criminals; meaning the violent murderers and rapists, as well as the white collar fraudsters who cost this economy billions every year.

I thank you.

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