South African History Online

Opening speech by President Nelson Mandela at the Euromoney Conference

Johannesburg, 14 November 1994

Mr. Chairperson;
Minister of Finance;
Sir Patrick
Sergeant;
Distinguished Guests;
Ladies and Gentlemen.

This conference is most timely. It brings those charged with managing our
country's finances - both public and private -together with those who manage a
large part of the world's investment resources. Our newly-established democratic
government has now staked out the economic framework within which it will be
pursuing its central task, that of bringing a better life for all South
Africans. I therefore appreciate most warmly the opportunity to be with you, and
it is a privilege to welcome such distinguished guests.

There is at present an exceptionally favourable environment prevailing,
domestically and internationally, for South Africa's transition. It is an
environment of which we intend to make the best use.

We have established a number of benchmarks which set the pace for our
successful transformation into a politically stable, economically prosperous and
socially equitable democracy and against which our progress will be measured.

Our primary objective is to address the basic needs of especially the poor.
We have to reconcile this with South Africa's resource constraints. We must
consequently shift our priorities, accept financial discipline and create a
climate conducive to sustained economic growth. Success in these objectives
requires a partnership of all social structures, because the aims which we have
set ourselves in the Reconstruction and Development Programme are achievable
only with a thoroughgoing transformation of our society.

This economic perspective has been developed in the budgetary process; in our
plan for the restructuring of government finances; and in the development of
international trade and financial relations.

This year's Budget combined a commitment to fiscal discipline with initial
steps to promote the re-allocation of public finance towards achieving the goals
of reconstruction and development. There were measures contributing to an
environment favourable to growth and the flourishing of business, including
improvements in the corporate tax structure. The 1995 Budget is being prepared
on the basis of a target of no real increase in recurrent expenditure, leaving
aside interest costs. A steady annual decrease in the budget deficit is
envisaged.

The prudent and optimal use of our limited resources will be advanced by the
recently announced plan to restructure public sector finances. A belt-tightening
exercise, including salary cuts for political office bearers, to make government
more efficient and cost-effective is combined with measures to accelerate the
re-prioritising of state expenditure to reflect RDP objectives. The public
service will be restructured through measures such as redeployment of personnel.
Public enterprises will be reformed by steps including the sale or restructuring
of state assets to improve efficiency. The achievement of these objectives will
be ensured through an effective internal monitoring capacity.

This programme should set a precedent for every institution which manages our
nation's resources, under whatever form of ownership.

Increased foreign investment and trade, while not solving our economic
problems, can make a critical contribution to the sustained economic growth
which is essential to a successful transition.

As the international trade arena opens up, South Africa is systematically
managing tariffs down to comply with international norms an to become more
competitive. This will necessitate major restructuring of the economy. It should
eventually boost exports and result in an efficient and competitive
manufacturing sector.

With the opening of international financial markets, we have obtained credit
ratings which will enable South Africa to return to the international bond
market at an opportune time.

We are committed to the abolition on the dual exchange rate and other
exchange control measures. This will in time further normalise South Africa's
international financial relations.

The measures I have outlined, important as they are, would achieve little
without the commitment and co-operation of all sectors of our society.

The developing relation between government, business and organised labour
exemplifies the partnership upon which our success depends. It will work through
the National Economic, Development and Labour Council, a forum for the
development of co-operation and consensus around a dynamic strategy for
sustained economic growth.

There are high expectations of our government's capacity to bring about
changes in people's lives. At the same time there is an understanding that
lasting and sustainable change needs careful preparation, and that one of the
conditions of lasting change is stability. Reconstruction and reconciliation,
development and nation-building, are mutually re-enforcing, inseparable aspects
of the national consensus on which the unprecedented legitimacy of the
Government of National Unity is founded.

The establishment of democratic local authorities through the holding of
local government elections next year will, by opening the way for the
involvement of communities in the development and implementation of
reconstruction programmes, consolidate our democracy. It will thereby further
secure the political stability which our country now enjoys.

This political environment and the economic growth engendered by the
reconstruction of our country create exceptionally favourable conditions for
investment. It is perhaps understandable that South Africa's long history of
conflict and instability left a certain scepticism about the prospects for
successful transition. But at each stage South Africans have succeeded where
failure was predicted. Although what has happened is often spoken of as a
miracle, it is in fact built on a solid and lasting foundation.

Ladies and Gentlemen.

There is no simple solution to our country's problems. But I am confident
that South Africans from every walk of life are determined to work together to
find solutions and have the capacity to succeed.

The international community has shown its concern for the well-being of South
Africans, in its actions to help end apartheid. The basis now exists for a
partnership of mutual benefit to South Africa and the international community.
The time is ripe for the planning and preparations, the assessment and analysis,
to be translated into practical action in the form of productive investments
which help build our country.

I wish you well in your deliberations during the next two days, as you seek
ways of building and strengthening that partnership through increased
investment.

I thank you.