Pretoria - South Africa must strengthen its economic performance as well as increase its level of investment if its economy is to grow, President Jacob Zuma said on Thursday.
The President, however, said despite the challenges faced by the country, progress was being made.
Addressing a special media briefing at the Union Buildings about the state of the economy, Zuma said the fact that the Gross Domestic Product (GDP) -- which shows that the economy grew by 0.9% in the first quarter of 2013, lower than market expectation -- meant that the country had to strengthen economic performance by stimulating the rate of investment.
“Growth in the remaining three quarters of the year will have to be much higher for us to achieve the projected annual growth of 2.7%,” said the President.
South Africa -- which was among the first economies to recover from the global financial crisis, after having shrunk by 1.9% in 2009 -- needed faster growth, without which unemployment, poverty and inequality could not be reduced.
The National Development Plan as well as the New Growth Path calls for growth rates of above 3.5% per annum to put the economy on the right footing.
Zuma said government will redouble efforts to support the economy towards achieving this. The President said that government could not do this alone, while calling for business, labour and the community to play their part.
“We must all promote our country and promote activities that enhance economic growth in every possible way,” he said, adding that government was working harder to boost performance in mining, agriculture and tourism, among others, which form part of the total six job drivers.
Focus on mining industry
On issues of the mining sector, which has been the key feature of the economy for over 130 years, the President called for a stable and growing industry.
The industry has experienced several challenges recently, including labour unrest.
“It remains the cornerstone of our economy,” Zuma said of the industry that accounts for 6% of the country’s GDP and generates 60% of SA’s export revenues. It also provides jobs to over a million people.
The industry, which last year saw the deaths of 34 miners at Lonmin’s Marikana Mine in August as well as wildcat strikes, has been affected by the depressed global environment.
“When our mining sector is in difficulty, this affects the wider economy, leading to industrial slowdown. In addition, 2012 was a difficult year for the mining sector,” he said.
Last week, Zuma asked Deputy President Kgalema Motlanthe to lead interactions with labour and mining companies.
The Deputy President was being assisted by the Ministers of Finance, Labour and Mineral Resources, and engagements, which have been described as “fruitful”, have already taken place.
“The Minister of Finance [Pravin Gordhan] has been using every available opportunity to reassure foreign and domestic investors of our seriousness and commitment to the mining sector and to affirm confidence in South Africa as an investment destination,” Zuma said.
Gordhan would continue with the task.
The President emphasised that South Africa has “an excellent legal framework governing industrial relations”.
As the collective bargaining season in mining and other industries kicks off, government called on all parties to recognise the impact of the industrial relations environment on jobs and development.
“We call for fair and expeditious settlements of wage negotiations that can contribute to the attainment of the country's job creation and job retention goals,” Zuma said.
Labour Minister Mildred Oliphant has been tasked by the President to support mining companies and unions in ensuring fair labour relations processes that promote order and stability in the sector.
Mineral Resources Minister Susan Shabangu will continue to support the industry in policy and operational aspects to promote certainty and stability in the sector.
Improving the living conditions of mining towns was also high on the agenda.
Zuma urged business, organised labour and government to continue engaging constructively.
“We are very neutral as government when it comes to our dealings with regards to what’s happening in the mines. I don’t think the government has taken any stance that takes sides when it comes to how we relate to the mines or labour organisations in the mines. We deal with matters very appropriately,” he said.
Zuma said although strikes were a normal part of democratic processes, however, unprotected wild cat strikes could not be allowed.
“I think people appreciate that there has been change in South Africa. Much as there are challenges, SA is making a lot of progress. The fact that people hear what is happening in South Africa [indicates] openness. The fact that [journalists] are not stopped from reporting shows that there is openness,” he said. - SAnews.gov.za
