DEPUTY MINISTER ALEXANDRA ABRAHAMS’ BUDGET VOTE SPEECH 2026/27 FOR THE NATIONAL COUNCIL OF PROVINCES
“WE NEED A NEW ECONOMIC DIRECTION”
House Chairperson,
Chairperson of the Select Committee
Minister Park Tau
Honourable Members
Fellow South Africans
Today our nation faces a difficult economic crisis and we stand at a critical crossroads. In 2025, our economy grew by only 1.1%, and the first Quarterly Labour Force Survey for 2026 from Stats SA revealed that a staggering 51% of young South Africans were neither working nor able to find work.
Behind every unemployment statistic is a real household under severe pressure; a business unable to expand; a young person losing confidence that their country has no place for them.
This is the tragic reality for millions of South Africans.
Last month, during the NCOP’s “Taking Parliament to the People” public hearings, we all heard the heartfelt lament of a resident in Matlosana, North West Province.
That in 1994, he was 18 years old. He had high hopes and big dreams for our democracy. Today, he is 50 years old.
He has never held a formal job in his entire life. In fact, there are millions of “born-frees” who have never worked a single day in the formal economy. If we do not act drastically right now, children born today in 2026 will suffer that same exact fate. They will live and die without ever knowing the dignity of having their own livelihood.
The central question before this House is simple: how do we promote faster growth, attract higher investment, and support the creation of sustainable jobs? This is the core purpose at the heart of our mission and mandate as the dtic. It is the “why” of our work every day.
Unfortunately, successive administrations in the past have believed that the path to success lies in more state control over the economy. These administrations believed that we could regulate our way to prosperity.
However, South Africa cannot regulate its way to wealth. Instead, we must educate and train our way there. We must industrialise and trade our way there.
And something else we don’t give sufficient attention to and in fact, written in the name of this department: competition. We must focus on how we leverage our immense resources and ensure that South Africa becomes a more competitive player in both domestic and international markets.
And while there are many bold reforms that government will need to apply to succeed in this, allow me to use my time to focus on three reform pillars to turbocharge the South African economy.
Pillar 1: Dismantling Red Tape and Building a Capable State
Honourable Members, the kind of investment that will catalyse economic growth is produced by confidence and certainty. It requires competitive open markets and functioning infrastructure. It needs a capable state that reduces barriers to growth. Government institutions must make it easier for businesses to invest, manufacture, export, and employ.
Currently, South Africa faces massive structural constraints. These include excessive red tape, infrastructure bottlenecks and deep regulatory inefficiency.
To fix this, we must prioritise and accelerate our efforts to streamline commercial legislation through the dtic’s Business Omnibus Bill in order to fundamentally improve the ease of doing business across all sectors. This reform-oriented framework will serve as a foundation for a more dynamic economy that is geared for a new direction.
On this foundation, we must continue building the key mechanism for fast-tracking investment in the form of a well-capacitated and fully operational Fusion Centre, where investment-related regulatory bottlenecks are addressed through referrals and follow-ups.
We must make every effort to ensure that this “high-speed approval lane” is successful and meets its 90-day turnaround timeframe for clearing through major projects that can boost local employment and industrial development, thus cementing the state’s role as an enabler of enterprise.
Pillar 2: Turbocharging Special Economic Zones (SEZs)
Chairperson, with the foundational framework clarified in the Business Omnibus Bill as our “what to do”, and the enabling mechanism of the Fusion Centre fully established as our “how to do it”, we will then need to sharpen our industrial strategy to determine “where to do it”, and the Special Economic Zones (SEZs) provide that answer. Turbocharging SEZ as reform pillar 2.
In theory, SEZs are supposed to drive investment attraction and promote manufacturing development. They should unlock sustainable job creation for surrounding communities and, at least on paper, we have good reasons to be optimistic about their potential.
For an SEZ to be truly successful, it needs to be genuinely special and seamless. It must offer investors different rules from the rest of the economy and crucially, it must offer far better operating conditions.
It must signal to international investors: Come set up your manufacturing plant here in South Africa instead of another country.
There has been some notable progress across some of the SEZs and the new TASEZ model is a positive start in respect to the greater private sector participation in terms of capital investment and risk-sharing. But we must ask: Is it enough?
The reality is South Africa competes against countries such as Vietnam, Bangladesh, Cambodia and the Philippines, where labour costs are significantly lower. This is one of the reasons we struggle to compete on labour-intensive manufacturing activities such as clothing, toys, and electronics assembly.
The 2026 World Bank Review of South Africa’s SEZ programme raises important recommendations and critical concerns.
It found that skills development and SME integration remains weak, with limited training outcomes and limited support reaching small businesses. This suggests that SEZs are not yet generating the broader economic spillovers that was originally envisaged.
The review was particularly critical of the programme’s performance on skills development and SME support. It found that only 1.93 individuals were trained for every R1 million spent, while only 0.18 SMEs received support per R1 million spent.
Chairperson, let us leverage the SEZs as “start-up sandboxes” to showcase radical red-tape reduction.
These could include:
- Reliable and competitively priced energy.
- Labour and employment flexibility
- Expanded Employment Tax Incentives and wage subsidy programme
- Fast-tracked port, airport and logistics access.
- Streamlined visa processes for investors and skilled personnel.
- Duty-free imports rather than lengthy rebate processes
- Quicker, simpler processing through Equity Equivalent Investment Programme (EEIP)
- Exemption from B-BBEE compliance.
Ultimately, SEZs should not compete with the domestic economy. Their primary purpose should be to attract export-oriented, labour-intensive investment that would otherwise not locate elsewhere.
The key constraint affecting SEZs is that we not yet competitive enough.
Chairperson, we owe it to the 12 million unemployed South Africans, of whom the majority are black South Africans, to at least try alternative reform and empowerment policies within SEZs to test them out and see the results. We are sitting on an unemployment tinderbox. We are witnessing it in real time with every march and protest. We have nothing to lose and everything to gain.
Pillar 3: Modernising Technical Infrastructure and Fighting Illicit Trade
Turning for a moment to some of the dtic’s institutional architecture, an underrated point in our economic discourse is the role of technical infrastructure entities as reform pillar 3. The four entities that function as the “corner legs” of this architecture are: the South African Bureau of Standards (SABS), National Regulator for Compulsory Specifications (NRCS), South African National Accreditation System (SANAS) and the National Metrology Institute of South Africa (NMISA).
The quiet work that they do concerning standards, accreditation, metrology, and product regulation are not merely bureaucratic side issues. They are vital economic infrastructure.
South African products must meet strict international standards to compete globally. Our factories cannot export if their goods are not certified quickly and affordably. If our regulatory environment becomes inconsistent, inefficient, or too costly, investment moves elsewhere.
Therefore, this budget debate is a timely occasion to be reminded that the financial allocations to these entities must translate into measurable improvements. We must demand better turnaround times, stronger governance, and expanded certification capacity.
We must also ensure that our testing facilities are modernised in real time so that businesses do not have to send their products overseas at great cost because we don’t have the testing capacity. It is through modernisation, innovation and partnership that these entities must actively support our exporters and manufacturers on the ground.
A capable regulatory environment must do more than just certify goods. It must play a critical role in combating the unfortunately thriving illicit market, where counterfeit and illegal products flood our shops, streets and informal sector daily. This illicit trade costs our economy billions of rands annually, which is stolen revenue that should be supporting local businesses, jobs and services.
Businesses that follow the law should never be forced to compete against businesses that ignore the law.
It is fundamentally an issue of fairness and the rule of law.
Government has a responsibility to ensure that legitimate businesses operating responsibly are protected from unfair and unlawful competition.
It is why government must continue to partner with private sector, civil society and law enforcement agencies to protect local production, clean up local supply chains and aggressively clamp down on non-compliance through strengthened enforcement action.
As the country where the Kreepy-Krauly pool cleaner was invented and the medical CAT scan was conceptualised and developed, there is no doubt that technical accuracy and high standards, in an environment that allows legitimate businesses and innovation to thrive, can be part of our toolbox to build South Africa’s global competitive advantage.
Conclusion
Honourable Chairperson, the choice before us is clear. We can choose to stay on our current path of low growth and rising unemployment. We can continue to believe that more state regulation will somehow solve a crisis caused by the state itself. Or we can choose a bold, new economic direction.
Let’s build an economy where that 50-year-old man in Matlosana can find work. We want to build a nation where a child born today in 2026 is guaranteed a future of opportunity, prosperity, and dignity.
South Africans want jobs. They want investment. They want an economy that gives all citizens, without elite connections, a fair chance to build a better life.
Let us therefore abandon the business-as-usual approach, and embrace the bold reforms demanded of us to build a working and prosperous South Africa for all.
I thank you.
MS ALEXANDRA ABRAHAMS
DEPUTY MINISTER OF TRADE, INDUSTRY AND COMPETITION
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