statement by Bantu Holomisa and Roelf Meyer

The United Democratic Movement (UDM) welcomes the fact that the Job Summit is taking place at last. However, the need for such a summit emphasises the failure of government policies towards job creation. The reasons for these failures are both structural and consequential. On the structural side it must be noted that:

  • The SA manufacturing industry runs only at 80% of its potential
  • The monthly motor sales are at the same level as they were in the middle of 1994
  • Building plans currently approved are lower than that in the middle of 1994
  • Manufacturing was 8% lower in August 1998 than in August 1997, whilst the world figure is 1 ½% up for the same period. All of these points indicate the need for some corrections in the management of interest rates and our currency.

On the consequential side, one must admit that we have suffered from the global decline in economic activity as well as from the high number of strikes which have had a particular influence on our export production and capacity during July/August 1998. This resulted in the lowest trade balance figures ever for South Africa in August 1998.

At its first National Congress on 27 June 1998, the UDM adopted a policy document which addresses the unemployment problem in South Africa. The UDM is proud of this innovative, but practical document and would like to present a few of its more crucial points:

  • The point of departure in our policy document is that neither government nor big business will be able to provide the job requirements
  • The only solution lies in enterprise development through which all South Africans can be empowered and the gap between those that have and those that don’t have can be narrowed

To make enterprise development successful an integrated approach is necessary. Specific practical solutions are also illustrated in our documents, for instance:

  • The need to make credit facilities and banking services accessible to the 60% or more of the population that do not have access now. This must be done through refocusing the capital market to assist new and emerging business.
  • The combining of formal and informal financing facilities like local stock exchanges.
  • Entrepreneurial and risk skills training through allocating government resources to practical training which enhances people’s ability to enter the economy.
  • Encouraging land owners to grant or sell shares in their farming enterprises through incentives.
  • Reviewing statutory wage requirements that will encourage job creation and which reflect the unique circumstances of areas and communities.

The UDM regrets the fact that it is not able to participate in the Job Summit because we are convinced that our contribution would be worthwhile and enriching.

In the latest competitive study report of the World Economic Forum it was indicated that South Africa fares relatively well in the institutional sector and general infrastructure. What is, however, of particular concern is that South Africa is at the bottom of the rating of labour skills and human development. The UDM therefore proposes that specific focus be put on these areas where the government has clearly failed over the last four years.