South Africa ‘must reposition for growth’

24 June 2010

South Africa has to reposition itself, and look beyond the traditional approaches, in order to improve its economic competitiveness, create jobs and beat poverty, says Finance Minister Pravin Gordhan.

Gordhan was addressing journalists in Pretoria on Wednesday ahead of the G20 Summit to be held in Toronto, Canada on the weekend.

The G20 is a coalition of the world’s foremost developed and developing nations, and South Africa is the only African member-country. President Jacob Zuma is leading the country’s delegation to the two-day meeting.

Gordhan said that if South Africa could beat France at the Fifa World Cup, surely it could do better in growing its economy.

“What we require is the same passion we see around the country during this World Cup period,” the minister said. “There’s a new passion, there’s a new energy … Let’s convert that energy if we want to promote growth in our country, and if we want to do things differently.

“Doing things differently takes boldness, it takes guts, but it requires a particular kind of leadership from all sections of society. If we stick to the traditional way of doing things we won’t create enough jobs, we won’t be able to compete in the world adequately.

“When we talk of growth, what we require is a much more active conversation about not how we do better in our traditional markets but how we do differently in our non-traditional markets,” Gordhan said. “We have more markets we can reach out to and grow our economy.”

Describing South Africa’s lastest employment figures as “depressing, to say the least”, Gordhan said that South Africans within the labour movement, the business community and the government “need to work harder and need to work together in order to ensure that the level of job creation in South Africa improves phenomenally”.

Statistics South Africa reported on Wednesday that a further 79 000 jobs were lost in the first quarter of 2010.

He said this weekend’s meeting was crucial in that the G20 had set an incredible track record in terms of co-ordinated and collective action in response to the financial crisis.

He said the challenge now facing the G20 was how they can get the world growing at a faster rate so that there was development and job creation as well.

The meeting would have to also resolve the sovereign fiscal crisis and uncertainties that are faced by certain parts of the world, as well as deal with financial market volatility following the fiscal crisis.

In recent weeks, he said, some countries in both the developed and developing world had stated that growth was a crucial issue for them, while others had said that fiscal consolidation was a crucial issue for them.

“One of the challenges we’ll have to resolve at the G20 is how do we balance these two factors. How do we balance the necessity for fiscal consolidation in a growth-friendly way?”

He said South Africa agreed with those who argued that there needs to be a stabilization of the global financial system. “We believe there needs to be coordination that doesn’t have to be uniformity. South Africa, Canada and Australia have a common belief that our banking systems are fairly secure.”

Source: BuaNews