STATE OF THE NATION ADDRESS 2005
SA to keep pushing investment
Richard Mantu
11 February 2005
The government will continue to increase the level of investment in South Africa's "first economy", says President Thabo Mbeki, providing skills and ensuring a lower cost of doing business, in order to boost growth and meet challenges in the country's "second economy".
In his State of the Nation Address to Parliament in Cape Town on Friday, Mbeki said the details outlined in the State of the Nation Address last year were still an integral part of the this year's programme of action.
Mbeki quoted economist Rudolf Gouws as saying that SA's current economic upswing was "not only the longest upward phase of the business cycle in the post-WWII period, but should also be sustainable into the future.
"As a consequence of the stronger growth, the employment picture in South Africa has gradually begun to improve. While South Africa certainly still has a major unemployment problem, there are encouraging signs."
On the issue of
infrastructure, Mbeki said the government had developed strategies and investment plans valued at over R180-billion in relation to transport logistics, electricity and water resources.
Transnet has already approved business plans for new investments in the Durban and Cape Town harbours, as well as the construction of a new pipeline between Durban and Johannesburg, Mbeki said.
Electricity utility Eskom would add R5.86-billion to South Africa's GDP by 2007 by operationalising three previously decommissioned power stations, a project set to create about 36 000 jobs at its peak during this year.
The President said the delays in setting up SA's second fixed-line telecommunications operator would be resolved soon, and that the "unacceptable situation in which some of our fixed line rates are 10 times those of developed countries will soon become a thing of the past".
Regarding public-private partnerships to address the country's socio-economic issues, Mbeki
welcomed the decision by country's banks - contained in the provisions of the Financial Sector Charter - to commit R85-billion towards financing low-cost housing, infrastructure, small black business and emerging black farmers.
On the issue on black economic empowerment, Mbeki said the long-waited BEE advisory council would be established once the process of public comments on the government's codes of good practice on BEE had been finalised.
Mbeki noted that a key programme for growing the economy through BEE was the development of small and medium enterprises, and referred to the Small Enterprise Development Agency, established in 2004 as a merger of Ntsika Enterprise and the National Manufacturing Advisory Centre to create a unified agency for providing non-financial support to small and medium enterprises.
"With the commitments from the private sector, as demonstrated by the banks, it is clear that together, as South Africans, we are set to make a determined
effort to speed up broad-based black economic empowerment and small business development", Mbeki said.
While the government had met its target of developing skills-based training for more than 80 000 learners, Mbeki said that more work still had to be done.
He said the government had approved a new national skills development strategy for 2005-2010, and that R21.9-billion would be allocated to fund the strategy over the next five years.
This would include improving cooperation between the country's Sector Education and Training Authorities (Setas), on the one hand, and the further education and training colleges and institutions of higher education, on the other.
Mbeki said the government had taken note of the delays in implementing some of its programmes for raising the level of investment in the economy, and said the government would ensure that the outstanding tasks were attended to within the next three months.
These include finalising a
government-wide review of performance practices in state-owned enterprises; discussions on investing 5% of investible capital of financial institutions in productive activity; and investing R220-million from the Rail Commuter Corporation in commuter transport and safety.
Others include improving the effectiveness of the government's skills development structures; completing the register of all graduates; and making the necessary changes in the governance of the country's Sector Education and Training Authorities.
"In consultation with our social partners, a number of constraints limiting our capacity to embark on a higher growth path will receive our urgent attention", Mbeki said.
Source: BuaNews
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