President Cyril Ramaphosa said on Thursday that the South African economy should grow at a bigger rate than the population growth rate over the next 10 years for the country to start creating jobs.
This as Ramaphosa announced during the State of the Nation Address (SONA) that economic transformation and job creation would be priority number one for his administration.
“We cannot turn our fortunes around without a relentless focus on economic growth. Within the next decade, it is our ambition that our economy should be growing at a rate far greater than our population.
“It is only when we reach consistently high rates of growth that we will be able to reverse the economic damage of our past. We make this assertion at a time when the economic outlook is extremely weak,” Ramaphosa said.
The South African economy slumped sharply in the first three months of 2019, contracting by 3.2 percent as seven of the 10 industries took a knock, with manufacturing, mining and trade the biggest contributors to the fall. Construction, mining and trade are in recession.
The 3.2 percent decline was the biggest quarterly fall in economic activity since the first quarter of 2009, when the economy – under strain from the global financial crisis – tumbled by 6.1 percent.
Following the sharp contraction in growth in the first quarter, the Reserve Bank now projects that growth in 2019 is likely to be lower than anticipated in the February Budget.
Ramaphosa said that one reason for the lacklustre economic performance has been the load shedding earlier this year, together with the continued uncertainty in the supply of electricity and the state of Eskom.
He said that the utility’s financial position remained a matter of grave concern, but said that Eskom had sufficient cash to meet its obligations until the end of October 2019.
– African News Agency (ANA)