ECONOMY
Govt confident about growth - Mbeki
Posted Fri, 14 Oct 2005
The government was confident of meeting its objective to raise
economic growth levels, President Thabo Mbeki said on Thursday.
"There is a sense of confidence in government about the target
we are setting ourselves with regards to... raising growth, that
they are realistic," he told foreign diplomats.
"There is a lot of confidence in government that this is not a
pipe dream".
The government aimed to increase economic growth to 4.5 percent
over the next five years and to six percent by 2014.
International Monetary Fund's predictions for South Africa's
economy to grow by 3.4 percent this year and 3.9 percent next year,
amounted to an underestimation, Mbeki said.
Problems the government was seeking to address included
under-spending and skills shortages.
The government had expected a budget deficit of 3.2 percent this
year, but "it is clear it was lower than that".
This meant money was available for pursuing higher
economy
growth through infrastructure development, among other things.
The government would also seek to boost private sector
investment in the economy, the President said.
Many companies were retaining large cash balances, probably out
of uncertainty about the currency.
This should rather be invested in the local economy.
Other initiatives would include the phasing out of import parity
pricing, reducing the cost of telecommunication and boosting small
enterprises through a targeted government procurement policy.
Corruption was another issue of major concern to the government,
Mbeki said.
"It seems that in society, generally, many people are driven by
a value system which says a successful person is a person who has a
very nice, posh and expensive car, a very nice big house, and
dressed better than the president."
This caused people to want to get access to wealth as quickly as
possible.
"This has very serious
consequences... in terms of society in
general but for government in particular."
Mbeki told the diplomats that they could expect action on this
front.
One did not want a situation where people in positions of power
thought this entitled them to public resources.
On international issues, Mbeki reiterated the importance of the
United Nation's reform and the successful conclusion of global
trade talks.
He also announced that an African development front should be
established by the end of the year, by encouraging investment from
pension funds.
Sapa
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