In his address to a joint sitting of Parliament on 15 October 2020, President Ramaphosa announced that “to fast-track the delivery of economic reforms, Operation Vulindlela will be implemented as a joint initiative of The Presidency and National Treasury.” The aims, objectives and progress made with Operation Vulindlela is clearly explained in the newly published Summary Booklet and Vulindlela Fact Sheet.
Dedicated capacity for Operation Vulindlela has been created in the Project Management Office (PMO) in The Presidency as well as in National Treasury, and in his Budget Speech Minister Tito Mboweni mentioned that Operation Vulindlela “has already made demonstrable progress in accelerating the pace of implementation of high‐impact structural reforms”. In his reflections of the 2021 budget, Andrew Donaldson also indicates that “we have to look to Operation Vulindlela, with its focus on key economic reforms and unblocking barriers to growth across all of government”.
Operation Vulindlela aims to modernise and transform network industries, including electricity, water, transport and digital communications. These network industries are essential to creating a globally competitive economy, and reforms to the visa regime are being prioritised to attract skills and promote growth in tourism.
A total of 19 priority reforms have been identified in these focus areas, and it is important to know that most of the reforms prioritised by Operation Vulindlela require little or no additional resources, and are budget-positive or budget-neutral. In the context of fiscal constraints, structural reforms are necessary to restore growth and confidence without new funding – including by removing policy and regulatory obstacles to private investment. In concluding their routine Staff visit engagements with South Africa in January 2021, the International Monetary Fund (IMF) also confirms that “South Africa remains committed to implementing structural reforms. Operation Vulindlela remains a critical coordination tool to unlock and fast track implementation of the structural economic reform agenda. It is based on similar “delivery unit” initiatives in countries such as the United Kingdom and Malaysia, as well as lessons learnt in South Africa. The initiative is staffed by a full-time technical team that draws on additional expertise and capacity in the public and private sectors”.
The initiative also draws critique, Neva Makgetla says both Operation Vulindlela and the 2021 budget centre on improving infrastructure for established businesses, especially around electricity, water and transport. The budget cuts overall expenditure but expands spending on physical infrastructure. And she adds “neither the budget nor Operation Vulindlela expands programmes required to build the middle class or diversify the economy. In real terms, compared to two years ago the budget shrinks per-person expenditure on education, social grants, housing and land reform”.