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Pretoria - Dimmer prospects for global growth create an uncertain environment even for South Africa, Finance Minister Pravin Gordhan said on Thursday.
"The global prospects for growth seem dimmer all the time. This kind of very uncertain outlook does create a challenge even for South African investors and business people," Gordhan said, speaking at the launch of the Land Bank's annual report.
Gordhan also warned current economic imbalances in South Africa were unsustainable.
Unemployment, officially at just under 26%, is a major factor behind an alarmingly high crime rate and is driving the economic disparity that makes the country one of the most unequal in the world between the haves and have-not’s.
"The global prospects for growth seem dimmer all the time. This kind of very uncertain outlook does create a challenge even for South African investors and business people," Gordhan said, speaking at the launch of the Land Bank's annual report.
Weak economic growth globally and debt problems in the United
States and Europe have led to concerns of a double-dip recession as data shows
the world’s biggest economies are failing to grow at a convincing pace.
A global rout has led investors to pile into the South African
fixed income market, which yields higher returns, as interest rates in many
developed economies are likely to linger at near zero levels.
The yield on the four-year South African government bond is trading
at 6.76% as offshore demand pushes yields to record lows.
Gordhan also warned current economic imbalances in South Africa were unsustainable.
“We’ve got to address a lot more sincerely, and a lot more frankly,
issues of inequality and joblessness,” he said
Unemployment, officially at just under 26%, is a major factor behind an alarmingly high crime rate and is driving the economic disparity that makes the country one of the most unequal in the world between the haves and have-not’s.
Gordhan this week suggested rigid labour laws crafted by the ruling
ANC and its governing partner organised labour to protect
workers may be costing the country jobs and should be revisited.
On Thursday, he said it also was time for top executives to look at
the hefty pay raises they have been receiving.
“It is unconscionable that we can have CEOs of companies
...walking away with R20m a year, and we have unemployed youth
walking our streets”.
