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Omigsa: SA needs to reassure investors

Johannesburg - SA authorities should "put to rest" any lingering fears over maintaining macroeconomic stability and market-friendly policies, Rian le Roux, chief economist at Old Mutual Investment Group SA (Omigsa), said on Tuesday.

One of the issues weighing on investors' minds was the ongoing debate about nationalising the country's mines.

Speaking during the group's quarterly economic briefing on Tuesday, Le Roux said this was one of the pre-conditions for SA to raise growth and employment.

Omigsa expected GDP growth at 3.7% in 2011 and 3.8% in 2012, inflation to average 6% in 2011 and 5.5% in 2012, and the prime interest rate, currently at 9.0%, to end the year at 9.5%, and rise to 10.5% in 2012.

Le Roux noted, however, that whether or not the SA Reserve Bank would hike interest rates this year or early next year depended on global developments.

Monetary and fiscal authorities also needed to maintain a strong anti-inflation focus and keep the government spending focus on infrastructure, Le Roux said.

Other aspects to be considered for raising growth and employment included raising public sector efficiency and "carefully" rethinking labour laws that might inhibit job creation. 
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