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Introducing economic reforms could add two to three percentage points to real GDP growth over the next 10 years, said Finance Minister Nhlanhla Nene.
The finance minister was speaking at the Government Employee Pension Fund’s thought leadership conference in Johannesburg on Monday. He highlighted efforts government is making to address challenges to economic growth.
The SA economy entered into a technical recession, as Stats SA last week reported that growth had contracted by 0.7% during the second quarter, on the back of a contraction of 2.6% in the first quarter.
“Should the global environment remain supportive, the effective implementation of reforms in areas such as agriculture, competition policy, telecoms, tourism and others could according to National Treasury estimates, add two to three percentage points to real GDP growth over the coming decade,” he said.
Treasury projected growth for 2018 to be 1.5%, at the National Budget in February. But growth of 5% is needed to improve the unemployment rate which is at 27%.
Government is working to ensure policy certainty and improve investor confidence, Nene assured. Policies which are reaching finalisation include the mining charter and the Integrated Resource Plan which is before Parliament. “The release of additional spectrum will occur shortly,” he added.
Nene also said that Cabinet’s stimulus package to reignite economic growth is set to be announced in October.
“Government is keenly aware of the key constraints to growth, and is redoubling its efforts to enact reforms that will raise our economy’s level of productivity, increase competition, and reduce the cost of doing business,” he told the conference.
But the official opposition party, the DA, has criticised the way the government has handled the economic pressures. DA leader Mmusi Maimane has requested a debate in Parliament this week which would look at ideas to bring about economic revival.
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