Cape Town - The cabinet has urged South Africans and businesses to exercise caution and responsibility in the management of finances, in view of current world economic events.
“Cabinet would like to reassure South Africans on our financial austerity measures, especially in light of the plunge by global markets in the recent week,” spokesperson Jimmy Manyi told a media briefing following cabinet’s regular fortnightly meeting on Wednesday.
Even before the 2008 financial crisis, South Africa had taken the necessary measures to ensure the soundness and stability of its financial system and fiscal accounts, he said.
This had enabled the country to weather the crisis when it hit. As a result, South Africa was one of the first countries in the world to register positive growth post the recession.
Economic growth accelerated to over 3% and the growth forecast for this year was 3.4%, he said.
“South Africa is monitoring the current global situation together with other G20 countries and stands ready to take action should the need arise.”
While acknowledging that recent developments posed risks to global and domestic growth, it was too early to predict the effect of current events on confidence and growth.
The National Treasury will publish growth forecasts in October, when it releases the medium-term budget policy statement, Manyi said.
Finance Minister Pravin Gordhan is expected to expand on the issue later on Thursday morning.