By Lehlohonolo Lehana.
The government has expanded the focus areas of the second phase of Operation Vulindlela with three new reform priorities, which will now oversee and coordinate the implementation of reforms across seven areas in total.
Cabinet approved focus areas under Operation Vulindlela, following outstanding work on Phase 1 in the areas of energy, water, logistics and visa reform had been completed, while new focus areas inlcuded local government, spatial inequality and digital transformation.
The additional reform focus areas Cabinet has directed Operation Vulindlela to consider include re-industrialisation and localisation, unlocking an infrastructure build programme, as well as the oil and gas sector and exploration.
South Africa has large reserves of gas and “the impeding gas cliff requires the country to build self-provisioning capacity in gas.
Operation Vulindlela (OV) is a joint initiative of the Presidency and National Treasury to drive the implementation of structural reforms to achieve more rapid and inclusive economic growth. In March 2026, Cabinet approved the focus areas and priorities for Phase II of OV.
To date, a total of 30 priority reforms have been identified across seven focus areas based on their potential impact on growth.
National Treasury Director-General Dr Duncan Pieterse delivered opening remarks, followed by a panel of senior officials who provided insights into the objectives and future plans for OV Phase II.
President Cyril Ramaphosa will then, launch the second phase of Operation Vulindlela at the Union Buildings in Pretoria to unleash more rapid and inclusive economic growth.
Operation Vulindlela was established in October 2020 as a joint initiative of the Presidency and National Treasury to accelerate the implementation of structural reforms.
In its first phase, the operation focused on reforms in five key areas with a high potential impact on growth and jobs: energy, logistics, telecommunications, water, and the visa system. 35 reform actions were prioritised across these five areas, with government departments and agencies taking responsibility for implementation while a dedicated Vulindlela Unit in the Presidency and National Treasury monitored progress and provided support.
Pieterse argued that Phase I had proved that well-targeted reforms, when implemented effectively, could have an effect on growth constraints.
He highlighted the progress that had been made in addressing electricity loadshedding, which had tapered significantly after peaking in 2022 and 2023.
The next phase of reforms in that sector would seek to build on progress as well as find solutions to the serious sustainability problem emerging in the distribution sector, which was resulting in localised outages and arrear debt owned by municipalities to Eskom had risen to over R100-billion.
The Presidency’s Rudi Dicks said that a new roadmap for the electricity distribution industry would be developed over the coming year, with the aim of setting in motion plans for the establishment of financially and operationally sustainable distribution companies.
Likewise, there were ambitions to accelerate reforms in the other sectors, including through: introducing private-sector participation in those parts of the freight logistics network still monopolized by Transnet; developing a National Water Action Plan and establishing a coordination structure to ensure water security; and implementing the points-based system for critical skills visas and general work visas.
However, Pieterse said the decision to add three new areas reflected the structural constraints to growth posed by the municipal service backlog and ongoing spatial inequality, as well as by a failure to integrate digital solutions.
“While South Africa’s overall growth trajectory remains constrained, these reforms have laid the groundwork for stronger performance over the medium term,” he said, adding that the upcoming Budget, to be released on May 21 after two previous failed attempts, will reflect the Operation Vulindlela priorities.
The Presidency’s director of strategy Saul Musker said, that Operation Vulindlela would be seeking to shepherd in a shift to a utility model for water and electricity services, whereby all metros would be required to establish or appoint ring-fenced, professionally managed and independently licensed utilities.
There would also be moves to ensure that all municipal managers and CFOs met the minimum standards for qualifications, experience and integrity, and to review how local government revenue matched its responsibilities.
Operation Vulindlela would also support the Department of Cooperative Governance and Traditional Affairs in publishing an updated White Paper on Local Government “to outline a modern and fit-for-purpose local government system.”
Musker also outlined an ambitious digital transformation agenda, which would involve investing in digital public infrastructure to enhance service delivery and expand financial inclusion.
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