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Ramaphosa vows to revive South Africa's stagnant economy

Ruvan BOSHOFF / POOL / AFP | South Africa's newly-minted president Cyril Ramaphosa (L) delivers his State of the Nation address at the Parliament in Cape Town, on February 16, 2018.

South Africa's freshly-appointed president, Cyril Ramaphosa, on Friday hailed "a new dawn" for the country in his first policy speech after Jacob Zuma's bruising nine-year term came to an end.


"We should put all the negativity that has dogged our country behind us because a new dawn is upon us and a wonderful dawn has arrived," Ramaphosa told parliament in the annual State of the Nation address.

In an ambitious and warmly-received speech, Ramaphosa vowed to revive South Africa's stagnant economy, tackle the country's dire unemployment rate and control spiralling government debt.

"Tough decisions have to be made to close our fiscal gap, stabilise our debt and restore our state-owned enterprises to health," he told lawmakers in parliament in Cape Town.

"Our most grave and most pressing challenge is youth unemployment," he added.

Zuma was forced to resign on Wednesday after the ruling African National Congress (ANC) party turned against him, with pro-business reformist Ramaphosa sworn in as president only on Thursday.

Zuma reluctantly resigned, complaining he had received "very unfair" treatment from the ANC.

Ramaphosa, 65, is a former trade unionist who led talks to end apartheid in the early 1990s and then became a multi-millionaire businessman before returning to politics.

Before the speech, Ramaphosa told journalists he was "a little bit excited, expectant, a little apprehensive".

Revive economy

After multiple corruption scandals, economic slowdown and falling popularity among voters, the ANC had threatened to oust Zuma via a no-confidence vote in parliament.

Among the immediate challenges facing Ramaphosa are a gaping 50-billion-rand ($4.3-billion, 3.44-billion-euro) deficit, the threat of further credit ratings downgrades, and 26.7-percent unemployment.

"Ramaphosa will probably remove many Zuma allies in a cabinet shuffle, but only after the budget speech on 21 February," predicted Eurasia Group analyst Darias Jonker.

"(He) will also go after high-level corruption, particularly the Gupta family and their associates, which include members of the Zuma family.

"This campaign will greatly contribute towards restoring investor confidence."

The Guptas are a migrant Indian business family who formed allegedly improper ties to Zuma. They are accused of receiving hugely favourable government deals and even influencing cabinet appointments.

Police on Thursday said an arrest warrant had been issued for one of the brothers, Ajay Gupta.

The COSATU trade union federation, an ANC ally, called on Ramaphosa to slim the executive and crack down on government excess.

"Bling lifestyles of the political elite at the expense of the tax payer must be stopped," it said.

The South African Communist Party (SACP), another ANC partner, said Ramaphosa must prioritise "dismantling of parasitic networks surrounding our state and decisively bringing an end to corporate capture of the state."

Stocks, currency strengthen

The transition to Ramaphosa saw benchmark South African stocks scoring their biggest gains since June 2016 while the local rand currency reached its strongest level against the US dollar in three years.

In previous years, the radical opposition Economic Freedom Fighters (EFF) party disrupted Zuma's annual State of the Nation speech with its lawmakers walking out -- or protesting and then being physically ejected from the chamber.

On Friday, though, the EFF remained in the chamber to listen to Ramaphosa's speech.

Ramaphosa, 65, is a former trade unionist who led talks to end apartheid in the early 1990s and then became a multi-millionaire businessman before returning to politics.

Zuma appointed him as deputy president in 2014.


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