Govt warns on skills shortage

The government wants to raise growth to 6% by 2010 from 4.5% currently to halve an unemployment rate officially estimated at 26.7% and widespread poverty by 2014.

"This much needed R320bn public investment could fall flat in the short term because of artisan skills and high level scarce and priority skills some of which we have to import," Mlambo-Ngcuka told a conference on foreign office operations.

"If we lose it on human resource development and skills we will lose momentum and goodwill."

The infrastructure investment by state-owned enterprises and government departments will cover electricity, water, roads, rail and harbours. The country's education system has been blamed for the country's skills shortage.

State-owned enterprises have unveiled plans to recruit engineers from outside the country, with particular emphasis on South Africans who have immigrated.

Private companies have complained that government red tape was not frustrating their efforts to import scarce skills.

"The private sector has told us they have problems with Home Affairs when it comes to bringing in scarce skills...and in general turn around time is too long at desk level and going through border gates by air or road can be a nightmare," she said.

Mlambo-Ngcuka said the government's accelerated shared growth programme aimed to improve the efficiency of the state, offer better conditions for business and clear up the red tape.

"We are addressing a phenomena of growth that is driven by commodity prices and consumer spending, both variables are therefore risky," she said.

Faster growth in Africa's largest economy is being driven by strong domestic consumption on the back of the lowest interest rates in over two decades.