13 June 2007
Investment in South Africa’s economy has risen steadily from 14.7% of gross domestic product (GDP) in the first quarter of 2002 to 19.2% of GDP in the last quarter of 2006, President Thabo Mbeki told Parliament on Tuesday.
In the last quarter of 2006, he said, investment grew at an annualised rate of 16%, well ahead of the 10% target of the government’s Accelerated and Shared Growth Initiative for South Africa (Asgi-SA).
Delivering the Presidency’s budget vote in Cape Town, Mbeki said South Africa’s economic growth was breaking records, citing “independently published research from … academic experts, ratings agencies that advise investors, and market research organisations.
“Check with all these experts and you will discover that they know what most South Africans know, that by September this year, the South African economy will have been growing for eight solid years, longer than ever before in the recorded economic history of our country.”
SA’s current rate of growth “has remained at a steady high level for longer than ever before in our history,” the President said, with average real income per person rising at around 4% per year since 2004 and more than 500 000 new jobs being created annually since September 2004.
“These facts are not contested among experts in the field, except for those who say that we may be undercounting some of these key numbers because the sample frames we use have not kept up with a changing economic structure,” Mbeki noted.
“There are also some who assert that many of the jobs created are in cyclical sectors like retail and construction, where job security is tenuous. Others point out that a considerable number of the new jobs created are in the informal sector.”
This was true, Mbeki said, but did not detract from the fact that “we are now creating jobs more rapidly than ever before in our history” and that, “unlike most developing economies, most of our jobs are created in the formal sector.”
Mbeki said the country should “celebrate the fact that the overwhelming majority of South Africans believe, from their lived experience, that tomorrow is likely to be better than today, and that their own hard work will help make it happen.”