Jonas: Wealth redistribution will not solve SA’s inequality problem

Deputy Finance Minister Mcebisi Jonas says radical economic transformation is not only about changing the structure of the economy.

FILE: Deputy Finance Minister Mcebisi Jonas. Picture: Screengrab

CAPE TOWN - Deputy Finance Minister Mcebisi Jonas says redistributing wealth alone will not solve South Africa’s inequality problem.

Jonas was speaking at a post-Budget event in Cape Town on Thursday morning.

On Wednesday, Treasury gave more details on the roll out of radical economic transformation, which was raised in the State of the Nation Address.

Jonas says radical economic transformation is not only about changing the structure of the economy because diversifying it is just as important.

He says partnerships with the private sector and quality education are among the factors government should be utilising to drive transformation.

But Jonas warns that redistribution will have very little impact on solving South Africa’s inequality problem and is likely to give little assistance to economic growth.

The Congress of South African Trade Unions and others claim the budget is not radical enough.

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Earlier, Jonas said that transforming the economy is a sensitive matter.

“The danger of course in the discussion, at the moment, is that you counter post-transformation with growth. We believe that it is not either or. We have got to build the economy but we have got to grow it in such a way that we begin to transform it.”

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(Edited by Zamangwane Shange)