Manuel: No return to 'excess'

Pretoria - Finance Minister Trevor Manuel says there's probably sufficient impetus now to effect a turn for the better in the global economic situation.

Manuel was speaking after his return from the G20 summit held in London this week.

He said the summit can't bring about a return to the period of "excess" that led to the crisis in the first place.

"There is a lot of concern beneath the surface about the excess and the behaviour of banks and outrageously inflated salaries," Manuel told a media briefing in Pretoria on Friday morning.

He said that governments have put in as much as they can to re-energise the economy, and that the key issue to watch is whether policy measures will find resonance in the private sector.

World leaders attending the G20 summit in London on Thursday pledged $1.1 trillion to fight the global economic crisis, which included trebling the resources of the International Monetary Fund to $750bn.

Manuel said the next step will be to see if the private sector now starts acting correctly in response to the G20 decision.

"The private sector can't just wait. After the banks' balance sheets have been rebalanced, how much more do they want before they start lending?" Manuel said.

In reaction to a question about what the future holds, Manuel said there will be a period of "evenness" across the globe where there won't be double-digit growth in most countries.

He reiterated that some South African sectors, like the automotive industry, are going to face "enormous difficulties", but said that this was not a uniquely South African situation.

"Manufacturing and parts of our mining will be under severe pressure," he said.

- Sake24.com

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