Treasury assures markets

THE National Treasury has assured the markets and the international community of a tough fiscal stance by South Africa despite the outcome of the local government elections.

The Treasury said yesterday it was concerned about comments by some of the ratings agencies on policy uncertainty following the municipal polls.

The assurance by the Treasury came after Fitch said the ANC could implement some of the popular policies to regain lost political ground.

The ratings agency said the heavy loss of the ANC at the polls could lead to a policy shift in the country.

However, the Treasury said this was far from the truth.

“Government remains committed to implementing fiscal consolidation and returning public finances to a sustainable path while protecting core social and economic programmes,” said the Treasury.

This week State Security Minister David Mahlobo also dismissed suggestions by the ratings agencies of a shift in economic policy by the government.

Mahlobo said there was no reason for the government to do this despite the outcome of the local government polls.

The ANC lost key metros and took less than 50% of the vote in the economic hub of Africa, Johannesburg.

It is trying to form a coalition in Ekurhuleni, which is another major site for the economy.

Mahlobo said there was no need for investors and the markets to press panic buttons.

The government would continue to stick to its business of providing necessary measures to jump-start the economy, he said.

The Treasury said there was also no need to sound alarm bells on what happened at the polls last week.

Despite the outcome of the elections the government was committed to the economic reforms it outlined early in the year.

It had collaborated with business and labour to address constraints in the economy.

The Treasury said they wanted to see economic growth in the country.

The government would work with all its partners to ensure this was achieved.

The Treasury also said it would stick to the expenditure ceiling outlined by Finance Minister Pravin Gordhan in the Budget in February.

WHILE many will congratulate the DA on the consolidation of the Western Cape and now with Nelson Mandela Bay firmly in blue hands, this will represent a change from some of the key senior ruling party members’ “don’t give a damn, I’m untouchable” attitude.

PE and Tshwane sent a different message.

The real game changer in SA politics has been the rise of the upstart EFF.

Having set out to capture the poorest and most disgruntled sections of SA society, their red and yellow branding with interesting promises was simply a brilliant strategy and produced interesting results.

Not too long ago the EFF was seen as a devil in SA politics and a symbol of destruction, mayhem and chaos.

Today the EFF is being courted by both the ANC and DA.

Not only did they weaken the ruling party to allow a DA victory, the real challenge – and this is a wake up call for the DA – is that the EFF dislodged the DA as opposition further north in SA.

In many municipalities the DA will rank third after the EFF.

And here just as the ANC explains its losses the DA will have to explain how they lost in such key areas as well.

The question for the EFF is do they co-partner with the ruling party and is this just another way for the patronage and arrogance to continue, or are they going to use their voting power to ensure cleaner administration and more efficient expenditure? MUHAMMAD OMAR

Durban North