Contemplating the GNU SONA: A pivotal moment for South Africa.

This was published in TimesLive on 05 February 2025

Since his election as President of a Government of National Unity (GNU)-governed South Africa, President Cyril Ramaphosa will face his first State of the Nation Address (SONA). This triggers an opportunity to reflect on the direction an otherwise fragile GNU coalition will present to the nation as its priorities beyond the tensions created by the signing of the sixth administration's outstanding matters, notably the BELA Act, the NHI Act, and the Expropriation Act. Questions abound on how the GNU will express the terms of the statement of intent signed after May 2024 and the non-negotiables from election manifestos that constitute the basis of the coalition.

As the leader of the GNU, President Ramaphosa's aspirations for the current administration are anchored on his lived experience of the first GNU administration. He is tasked with navigating the delicate balance required to demonstrate that signing the sixth administration's outstanding policy matters was a hygienic completion of the absolute majority to govern and not a tone for the remaining GNU co-governing period per the dictates of the reigning electoral mandate. The seventh administration represents a national unity context sold to the investor community. It is already attributed to the stabilising and positive sentiments that characterised the latest Davos parade of RSA as a safe FDI destination.

RSA traditional opposition politics, whose impulse has for a while been that of a state that managed the public sector-induced economy as an antidote to a supposedly non-transforming private sector one, is challenged to demonstrate an improving trust relationship between capital and the state. The resurgence of national economic interests as the basis of international cooperation and international relations is an area of interest which has spurred the private sector to volunteer its resources to encourage a new wave of national unity. A transition from a state that managed the economy for transformation objectives to one that focuses on working it to propel private sector investment is underway. The interdependence of private sector economic objectives with the obligations of the state to respect, protect, promote, and fulfil the economic transformation promises of a post-apartheid RSA defines the new era.

What would then dominate the 2025 SONA, given the historic moment of a National Dialogue precisely 70 years after the consequential Congress of the People in Kliptown SOWETO? South Africa is out of its energy security woes as ESKOM is marching comfortably to balance grid demands and the commitment to clean energy initiatives. The logistics network industry is in a planning phase that enjoys the nodding of infrastructure investors from the local financial markets. The current efforts to intervene and prevent the closure of Accelerator Mittal are because of its strategic importance in reigniting an industrialisation programme with the renewal of the rail network as a real domestic market for first production outputs. The 2025 SONA should be instructive to economic recovery and resuscitation of South Africa's industrial prowess as a deserving member of the BRICS and G20 community of nations.

The three-decade-long preoccupation with economic transformation that deindustrialised and grew the services industries, including a salary-driven growth path that saw a bulge in the public sector wage bill, has cost South Africa valuable time and momentum to build a new economic order in ways that limit competition for a low-to-no growth and jobs-decimating economy. The relevance, if not value, of the GNU, should be tested in terms of how it broadens its planning horizons and eschews jobless growth. The pressing problems of economic transformation to reflect the country's demographics, race and class inequality, unemployment, and unsustainable levels of a social grants-dependent society will not be solved by strengthening private sector discretion, euphemistically called the free market, to the detriment of a capable and interventionist state.

The global trend indicates a world that is hard at work to introduce industrial policy frameworks based on government intervention and, in extreme cases, state-led capitalism to protect their economies from being consumers of outputs from industrialisation programs that do not create local jobs. A nationalist economic development wave, which South Africa has experienced building and managing, is predominating large economies. India is poised to follow suit once it finalises its resources-based economic growth path. With a growing trust relationship between the C-Suites in a country, the prospects of a patriotic intersectoral collaboration in the private sector, where internal to the country value-chains trap as much as possible national value, sovereign and not state control, could be a model RSA pilots for the world.

The current coalition arrangement's firmament of national unity introduces an era of consolidating elite economic power. The 2025 SONA should be about a policy framework facilitating sovereign thinking among the country's cognitive, financial, or other elites. In this SONA, the President should impress upon industry captains, holders of the national liquidity reserves, and influencers of global FDI networks to move past the trust-deficit thinking mentality. He should call for releasing resources to pursue a new primacy for the RSA economy in the global scheme of things. Through the medium of the looming National Dialogue, poised to sponsor a 1955 Freedom Charter standard national outcome, the private sector should renew its commitment to building an economic order that strengthens and advances the otherwise consolidating post-1994 democratic and constitutional order.