3 October 2013
South Africa is already busy tackling the issues raised by the International Monetary Fund (IMF) in its latest country report, the National Treasury said on Tuesday.
The IMF said in the report that, while a weak global economy was not helping South Africa to lift its growth to the levels where it could start making a dent on unemployment, the country had to focus on tackling domestic constraints to growth.
In particular, the IMF urged South Africa to move forward with the structural reforms outlined in the country’s National Development Plan (NDP) in order to boost growth and create jobs for a growing population.
The issues raised by the IMF report “are already captured in government policies and programmes,” the Treasury said in a statement, noting that the Cabinet, during a three-day meeting in August, had agreed on a number of measures to reignite economic growth in South Africa.
These measures were “in part informed by the recognition that the South African economy can no longer rely heavily on the global economy to reignite growth and create job opportunities for the millions of unemployed South Africans”, and included:
- Resolving the country’s electricity supply constraints;
- Increasing investment in infrastructure;
- Improving the regulatory environment;
- Stimulating development in agricultural;
- Growing the prospects for youth employment; and
- Intensifying support for small business development.
The Cabinet had agreed to focus on speeding up the implementation of domestic plans to grow the economy in an inclusive way, as well as to seize opportunities in the wider southern African region.
“One of these issues is the implementation of the National Development Plan (NDP), which government believes will make a significant contribution to the longer term effort to address both historical and new challenges confronting the South African economy.”
The Treasury noted that tackling issues around South Africa’s political economy, as well improving the performance of the country’s public sector, “is an ongoing process requiring a wide range of measures and interventions”.
Steps were being taken to improve labour relations in key sectors such as mining, while the government was strengthening its administrative structures and processes in order to achieve better service delivery and public accountability.
“We remain committed to fiscal consolidation and the need to rebuild fiscal space,” the Treasury said, adding that South Africa’s fiscal policy “remains grounded by the three principles of counter-cyclicality, debt sustainability, and inter-generational equity.”