Here’s what finmin Mboweni’s MTBPS should address to revive the economy

South Africa stands at a critical juncture as the country eagerly awaits the Medium-Term Budget Policy Statement (MTBPS) by Finance Minister Tito Mboweni. The recent announcement of a special paper on Eskom by Public Enterprises Minister Pravin Gordhan and the startling 11-year high in unemployment have cast a shadow on the economy, leading to a sharp decline in the value of the rand. The upcoming MTBPS has raised hopes and concerns alike, with analysts predicting a pivotal moment in South Africa's economic trajectory. Xhanti Payi, Lead Researcher and Economist at Nascence Advisory, delves into the key aspects that need addressing to revitalize the economy. Here are the key highlights and insights from the pre-MTBPS interview. One of the pressing issues that South Africa faces is the need for a strategic plan that aligns with inputs from various stakeholders, including the business sector. Payi emphasizes the importance of incorporating these inputs into the budget strategy, particularly in sectors like infrastructure and technology. He highlights the significance of not just investing in telecoms but ensuring that the community benefits and engages effectively with technological advancements. Moreover, the integration of renewables into the energy sector is deemed crucial for sustainable growth. The conversation shifts towards state-owned enterprises (SOEs), with a focus on Eskom and the challenges it poses. Payi underscores the urgency for reforms within SOEs, emphasizing the necessity of making tough decisions, including possible retrenchments, to ensure long-term viability. Despite political hesitance, he argues that accepting such measures is vital for the well-being of these entities in a competitive economic landscape. Payi reflects on Mboweni's credibility as the finance minister and the expectations pinned on him. With the lingering issue of unemployment and Eskom's financial woes, Mboweni faces a formidable task of presenting a budget that instills confidence and offers viable solutions. The analyst suggests that Mboweni's reputation as a tough decision-maker will be put to the test, and any soft approach in the budget may not be well-received. As the nation eagerly anticipates the unveiling of the MTBPS, all eyes are on Mboweni to chart a course that steers South Africa towards economic recovery and stability. The outcome of the budget statement will undoubtedly shape the country's economic landscape for the foreseeable future.