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Johannesburg – South Africa’s private sector runs the risk of being “too risk averse” and not releasing much needed funds into projects that could drive economic growth and employment‚ Finance Minister Pravin Gordhan told an FNB breakfast on Friday.
The private sector is reported to be hoarding billions of rand in cash mainly due to an uncertain economic environment.
Minister Gordhan said while it was “understandable” to hoard cash while companies calculated risk‚ it was equally important for them to join the private sector to invest and grow the economy.
“If we do not find common ground amongst ourselves then all of us lose‚” Gordhan said.
The Minister said the key issue for SA now was growth.
“The time has come to focus on growth issues and structural challenges‚” he said.
The Treasury revised its economic growth forecasts for the next three years lower‚ forecasting growth at 2.7% this year‚ 3.5% next year‚ and 3.8% in 2015.
“We have been treading very difficult waters over the past four years‚” Gordhan said.
He added that while government was still committed to fiscal consolidation‚ events “outside of our control” always disrupted programmes.
Gordhan also called on the private sector to partner with government in implementing the National Development Plan to address joblessness‚ improve the quality of education‚ and eradicate poverty.
