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Jacob Zuma fails to fulfill economic promise to South Africa

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February 25
7:13 AM 2016

The criticism over President Jacob Zuma's inability to transform South Africa into an attractive place for business is increasing by the day. Right from common people to businessmen is calling for government's commitment to restore business confidence on South Africa. 

All sections of the society are raising voice for making South Africa a favorable place for global investors and businessmen. The business is very slow in tier-II cities. An Uber taxi driver narrates the prevailing situation saying that to get a thing done in a village, one has to get approval from municipal boss, the tribal chief and his deputy, and a local politician from African National Congress (ANC). 

Financial Times reports that President Zuma is at the center of criticism over corruption, bureaucracy and lack of commitment of the government. Corruption is apparently visible in every stage right from village to the power center in the capital city Johannesburg.

However, President Jacob Zuma has never been convicted of corruption. Charges against him were, in fact, ruled out in 2009. It's difficult to find a businessman or official in Johannesburg, who doesn't think the President has worsened the economy. Zuma has strengthened a patronage machine within the Party. 

Standard & Poor's has downgraded sovereign rating to negative outlook. Recently re-appointed Finance Minister Pravin Gordhan by President Zuma has a tough time to make a balancing act. Gordhan presented the 2016 budget for South Africa on 24 February 2016. He is doing his best to avoid a downgrade of South Africa's sovereign credit rating to junk status. 

Meanwhile, President Zuma has postponed his Iran tour. The president's office didn't give any reason for the cancellation of his trip to Iran. Zuma's office said in a statement that "the state visit to the Islamic Republic of Iran by President Jacob Zuma, as announced earlier this week, has been postponed to a later date." Pretoria province in South Africa is planning to set up an oil refinery to process Iranian crude for its petrol supply and reduce import bill, as reported by Reuters.

Finance Ministry, South Africa's central bank and other institutions are in the process of bringing back South Africa on growth path. First of all, the restoration of business confidence among foreign investors that South Africa is a better place for business is need of the hour. 

Despite all these problems, South Africa is able to attract global businessmen and companies. Similarly, South African companies are also showing interest in expanding overseas. For instance, Steinhoff, a local furniture retailer, is expanding to Frankfurt. 

On the other hand, criticism over the government's inability from different quarters of the society has been growing, according to NewStatesman. Recently, a former Cabinet Minister expressed his concerns over the degrading image of South Africa. 22 years ago, the radiance of Nelson Mandela's rainbow nation has gone from hero to zero. 

Another incident that highlights of confusion and lack of strategy of Zuma-led government is frequent changes in Finance Ministry. In just short span of five days during December 2015, three Finance Ministers came and gone. Nhlanhla Nene was sacked by Zuma and this created tremors across the financial markets. South African currency Rand crashed.

South Africa is still suffering from apartheid system and alarming unemployment rate of 35 percent. Lack of infrastructure facilities is another major challenge for the country. Despite all these persisting problems, South Africa has managed to transform into a mature economy. Led by recent commodity boom, South Africa's per capita gross domestic product (GDP) rose to $6,000 in 2015. 

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