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DIRECTION FROM THE THRONE

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One cannot over echo the sentiments and the analysis already shared regarding the Speech from the Throne.

All one can say is the King has spoken; it is now up to Parliament to execute the mandate. The speech touched on a number of issues pertinent to the economic growth and development of the country. I viewed it as a speech for the economy. I believe Their Majesties coined the speech not oblivious to other problems that the country faces, but a clear understanding that the economy is a binding constraint in solving the country’s social problems.

Binding constraints

A binding constraint is an obstacle that, if solved, a number of the problems that one faces would automatically solve themselves. My view is that the most emerging needs of our people would be solved if we got the economy moving. Listening to His Majesty’s speech, I got to appreciate the fact that government has also identified where the country’s major fault lies. When one addresses a binding constraint it is not to say that other problems do not exist, but focusing on the constraint would solve those problems. The country still has to deal with the problem of poverty, food security and sufficiency. I contend that if we grew the economy to the point of growing an economy that creates jobs would allow people space to move out of poverty. Hence at this point I have to focus on critical areas that as a nation we will have to focus on to move the economy.

Energy

Topping my priority list is heavy investment in energy; it is imperative that we have control of our power grid. Presently our electricity needs are highly dependent on electricity being imported and this is not good for commerce since keeping the lights on requires they that import to always have your interest at heart. This creates an unstable environment for business, more especially when the contract approaches terminality. His Majesty also commissioned the construction of the Phuzumoya Fuel Reserve facility. Construction of the facility will assist the country’s ability to cushion rampant fuel price increases as we have seen in the past. This will improve the ability to stabilise the business environment; fuel is the bedrock of the economy, predictable logistics are critical. These investments will unlock the country’s ability to pursue private sector-led growth.

Efficiency

His Majesty called on government to be innovative and come up with efficient methods for building the country’s roads. I call on government to heed this call beyond the construction of roads. The whole government machinery needs to be efficient so that we can get more with the resources that we have. His Majesty also touched on building a referral hospital that will provide specialised care. This is yet another area of efficiency that the King has identified and we need to tap into it as a nation. The country spends a lot of money referring patients for care outside the country, yet localising the services will improve resource efficiency in the health sector, opening fiscal space for improved investments in other sectors of the economy. It is imperative for government to identify other areas of efficiency improvement so that we improve resource allocation in our economy.

Corruption

His Majesty called for the prosecution of all those found to be involved in corrupt practices. Corruption has become endemic and entrenched in all sectors of our society. The fiscus loses billions of Emalangeni a year to corruption at the peril of social services and other developmental programmes in the country. We applaud the efforts of the prime minister of setting up a corruption task force, however, instead of re-inventing the wheel rather we re-capacitate the Anti-Corruption Commission to be a potent force in the country, curtailing corruption in all shapes or forms. Arresting the problem of corruption also improves the country’s ability to attract direct foreign investments into the country. Government should take a leaf from the prime minister and grab the problem of corruption by the horns.

Youth

His Majesty spoke elaborately about the youth and the challenges they face; further proposing policy actions that have to be taken in arresting the problem. It is imperative that government formulates deliberate policy actions to address the problem of youth unemployment, lest we raise a dead generation. One would only hope that the Finance minister will have an explicit allocation for the youth in the upcoming financial year. Resource allocation communicates a country that is willing to address the problem directly. Mainstreaming a solution, however, usually results in no serious gains in addressing the problem since it ends up usurped in the areas in which it is mainstreamed.

Government machinery

In my view, the King gave a very good blueprint that we ought to follow to grow and develop the economy. It is now incumbent on the Finance minister to operationalise this blueprint through resourcing it. Other Cabinet ministers will have to take the baton and move forward with implementing the blueprint given by the King. It is time for business unusual and radical economic policy to attain above a five per cent growth annually.

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