The most meaningful impact for any economic policy intervention is one felt through high employment, inequality and poverty
The phrase “in the interest of balanced and sustainable growth” is found in section 224 of the constitution, which deals with the mandate of the Reserve Bank.
Balanced economic growth generally means that the primary, secondary and tertiary sectors of the economy grow harmoniously. From 1960 to 2021 the rate of change in the value add from the primary sector of the SA economy to overall economic growth has trended mostly sideways. The rates of change in value add from the secondary and tertiary sectors have trended downwards.
So, instead of embarking on unhelpful conversations, the right questions must be asked. For example, the question about who owns the central bank deprives us of an opportunity to ask the more relevant question of whether the actions of the Reserve Bank are in the interest of balanced and sustainable growth.
Whether it is undertaking actions on the future of energy, making decisions on administered prices or setting up institutions to respond to socioeconomic challenges, the question should always be: “Are the actions undertaken with the aim of achieving balanced and sustainable growth?” The espoused 2018 principles around the economics of the new dawn, namely heightened accountability, economic renewal, systematic co-ordination, improved collaboration, rejection of corruption and active citizenry, remain relevant now. But as suggested then, the difference between getting these principles to work and sliding deeper into dysfunctionality will be determined by how well the public sector leads the process.
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