Centre for Economic Development and Transformation founder Duma Gqubule has dismissed ANC NEC plan to sell electricity at cheaper rates to chrome, manganese, and steel industries as a flop and too late for purpose.
Gqubule said the plan will not be as effective now as it would have been when companies complained that the sky-rocketing electricity tariffs were making it hard for them to work in the country.
He said over 300 000 jobs have been lost in the country due to the cost of electricity and the ANC only responds to the issue when it has already late.
Struggling households, firms need cheaper power
Gqubule emphasised that even households cannot afford the electricity tariffs, which would need the government to have to increase free basic electricity and provide subsidies to households, and to companies that cannot afford it.
“People have shut their firms, Merafe is the latest one. Are you telling me because of these export tariffs and presidential tariffs all of these people are going to come back? It is a little too late and the people have been crying for the past 15 years about these unaffordable electricity prices which are destroying the economy and manufacturing jobs,” said Gqubule.
He also mentioned that he was disappointed at Ramaphosa for not including the critical numbers and amounts to the interventions that have been discussed at the ANC NEC special meeting.
“All of these 10 interventions will not make a difference because National Treasury does not give us growth targets,” said Gqubule.
Speaking at the close of the ANC NEC special meeting on Sunday, Ramaphosa said government will also fast-track the construction of 14 000km of new power transmission lines to strengthen the national electricity grid and make it easier to deliver power where it is needed.
“Among other things, this means preferential electricity tariffs chrome, manganese, as well as steel. We will fast track the transmission development plan to establish or to install 14 000km of transmission lines for our electricity grid,” said Ramaphosa.
He said these measures form part of 10 priority interventions identified by the NEC to reignite economic growth, create jobs, and lower the high cost of living.
Reigniting economic growth
Ramaphosa said government intends to use electricity tariffs and infrastructure investment to drive industrial growth, reduce production costs, and attract new investment. The move comes as South Africa battles high electricity prices.
Ramaphosa said government would accelerate the expansion of generation capacity.
“We welcome, in particular, the progress made in resolving loadshedding, expanding generation capacity, and establishing a competitive electricity market. We also have seen great strives in progress that is being made in the logistics sector including steady recovery in Transnet’s performance. But the impact of this work is yet to be felt in our growth and employment figures,” said Ramaphosa.
He said the NEC’s discussions were guided by the three strategic priorities of the seventh administration which are inclusive growth and job creation, reducing poverty and the cost of living, and building a capable, ethical, and developmental state.
Scaling up implementation
“We must therefore accelerate the pace and massively scale up the efforts that we need to take. We will focus on the implementation and delivery. So, it is going to be implementation, implementation, implementation,” said Ramaphosa.
He added that the government would also boost local economic development in townships and rural areas, expand support for small businesses, and grow provincial economies outside the main cities through the revitalisation of industrial parks and investment in labour-intensive industries such as agro-processing, textiles, and light manufacturing.
Ramaphosa said trade expansion would be another focus, with efforts to strengthen South Africa’s participation in the African Continental Free Trade Area and to increase exports to BRICS+ countries and new global markets.
“This will include an emergency industrial support package for sectors affected by increased tariffs. We will expands exports under the Africa Continental Free Trade Area, as well as exports to BRICS+ countries, and indeed to other markets where we will be paying visits in due course,” said Ramaphosa.
Ramaphosa reaffirmed commitment to Broad-Based Black Economic Empowerment, saying it remains central to correcting historical injustices and ensuring inclusive growth.
