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BLSA CEO calls on Godongwana to work swiftly on strengthening economy

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The BLSA CEO has highlighted some key responsibilities that the new Finance Minister needs to ensure for economic growth and increased investor confidence and fiscal discipline.

Business Leadership South Africa’s (BLSA) CEO, Busi Mavuso released her weekly letter on Tuesday, 10 August 2021, in which she stressed that the new Minister of Finance, Enoch Godongwana needs to move quickly to signal his commitment to continuing the progress of structural reforms and fiscal discipline by former minister, Tito Mboweni. Mavuso noted that the sharply deteriorating debt position of the sovereign, triggered by the loss of investment grade ratings in 2020, is a risk to the entire economy.

The CEO stressed that the government could not spend its way to economic growth, and that there is a need for constrained spending to allow the fiscal outlook to improve. She also pointed out the need for investment to be central to economic recovery thinking, especially public sector investment, which she believes needs to be protected and consumption expenditure constrained.

Mavuso further noted that the Operation Vulindlela project had been the biggest confidence booster when it came to structural reforms. The CEO also stated that Minister Godongwana needs to embrace and advance the policy developmental agenda to have a dramatic impact on the economy, and that BLSA is committed to assisting in economic recovery.

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