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5% GDP growth 'doable' this year

Feb 24 2005 12:26 Helmo Preuss

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Cape Town - Five percent Gross Domestic Product (GDP) growth in South Africa is "doable" in 2005, Finance Minister Trevor Manuel said in a post Budget briefing on Thursday morning.

In his Budget presentation on Wednesday, Manuel forecast 4.3% growth in GDP, which he said was in line with the consensus of economists, compared with last year's 3.7%.

"I think 5% GDP is doable if we look at what happened last year. In February we forecast 2.9% growth and the consensus at that time was 2.2%.

"The actual outcome was 3.7%. So with the measures that we put in place yesterday, I believe 5% growth is doable.

"The main focus of the Budget is that we are going to invest in the future. The more we invest in people, the more likely it is that we can get 5% sustainable growth, as a key constraint on this economy is the availability of skills."

Basic income grant would bankrupt SA

In response to a question as to why South Africa does not extend the social grant, which already reaches 11 million people out of 46 million, Manuel said there are proponents of the basic income grant who say that every man, woman and child in South Africa should get R100 or R150 a month.

If that was implemented, it would cost in the region of R90bn a year, which would bankrupt the country.

Manuel corrected a question quoting a 40% unemployment rate in South Africa, saying if that was correct, "we would have a revolution in South Africa".

In the State of the Nation address in February, President Thabo Mbeki said there would be more resources allocated to South Africa's statistical authorities.

 
 
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