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Cape Town - Growth prospects for South Africa's economy this year have been adjusted downwards to 2.1% of gross domestic product in Wednesday's mini budget.
GDP growth is nevertheless expected to recover to 3.0% next year and 3.5% in 2016, Finance Minister Pravin Gordhan said in parliament.
According to the medium-term budget policy statement document, factors supporting an impoved medium-term outlook include stronger growth among SA’s key developed country trading partners, robust trade and investment in sub-Saharan Africa, the availability of new electricity supply by the end of 2014, and major investments in rail and bulk water supply.
“The National Development Plan provides a longterm framework for improved cooperation between the private sector, labour, government and civil society.
"Determined focus to bring about the reforms envisioned by the plan will increase the capacity of the economy to grow more rapidly, allowing SA to substantially reduce poverty and enequality.
“Government has a broad package of measures to promote job creation – from special economic zones tot public employment programmes. Draft legislation has been introduced that will create a tax inventive intended to boost employment among young work seekers.”
Gordhan stressed that global economic growth prospects are still subdued, but that SA cannot rely on the global economy to be the main driver of domestic growth and development. Structural reforms to achieve sustainable growth and job creation are therefore necessary.
Education and productivity must be improved, brand competition and competiveness of local firms increased, the level of savings and investment raised, the role of black empowerment initiatieves broadened and the efficiency of state-owned enterprises strengthened.
The mini budget projects inflation at 5.9% in 2013, and says it should remain within the target band over the medium term. The weaker rand, however, poses a risk to the inflation forecast.
Employment increased by 274 229 jobs in the year to July.
GDP growth is nevertheless expected to recover to 3.0% next year and 3.5% in 2016, Finance Minister Pravin Gordhan said in parliament.
According to the medium-term budget policy statement document, factors supporting an impoved medium-term outlook include stronger growth among SA’s key developed country trading partners, robust trade and investment in sub-Saharan Africa, the availability of new electricity supply by the end of 2014, and major investments in rail and bulk water supply.
“The National Development Plan provides a longterm framework for improved cooperation between the private sector, labour, government and civil society.
"Determined focus to bring about the reforms envisioned by the plan will increase the capacity of the economy to grow more rapidly, allowing SA to substantially reduce poverty and enequality.
“Government has a broad package of measures to promote job creation – from special economic zones tot public employment programmes. Draft legislation has been introduced that will create a tax inventive intended to boost employment among young work seekers.”
Gordhan stressed that global economic growth prospects are still subdued, but that SA cannot rely on the global economy to be the main driver of domestic growth and development. Structural reforms to achieve sustainable growth and job creation are therefore necessary.
Education and productivity must be improved, brand competition and competiveness of local firms increased, the level of savings and investment raised, the role of black empowerment initiatieves broadened and the efficiency of state-owned enterprises strengthened.
The mini budget projects inflation at 5.9% in 2013, and says it should remain within the target band over the medium term. The weaker rand, however, poses a risk to the inflation forecast.
Employment increased by 274 229 jobs in the year to July.
