London - The recent weakness of the rand
will benefit South African exporters and is positive for the
economy, ANC treasurer general Mathews
Phosa said on Wednesday.
"I am not crying, we are not stressed about the weakness of
the rand - definitely it's a spinoff for our exporters," Phosa told Reuters in an interview while on a trip to London
meeting business people and politicians.
"We should celebrate it - a strong rand does not help
exports, we have seen businesses breaking down."
The rand, like many emerging market currencies, was
strong earlier this year as money-printing in the US
encouraged investors to buy high-yielding assets overseas. A
strong currency raises the price of business exports.
But the rand has fallen sharply in recent
weeks alongside a selloff in commodities, as investors grow
anxious about the global economy and the eurozone debt crisis.
The rand hit its lowest since May 2009 late last month, a
plunge of 21% from the end of July, but has recovered
slightly since then.
Phosa also said other industries should copy plans by a
South African textile union to offer massive wage reductions to
unskilled workers to create jobs.
"We welcome this sort of development, to enable us to grow
the economy to create jobs - our labour costs are not
competitive."
South African youth unemployment is at about 50% and
a study by the South African Institute of Race Relations said
about half of the current generation of those between 25 to 34
years old will never work in their lifetimes.
Economists have said without an inexpensive way to take new
workers into a workforce suffering from a chronic unemployment
rate of about 25%, the unemployed will likely remain
unemployed - raising government spending for welfare benefits.
Firms have shied away from South Africa due to the laws that
make it expensive to hire and fire workers and are ranked by the
World Economic Forum's Global Competitiveness Report as some of
the most restrictive in the world.
Mines nationalisation
Phosa said the businesses and politicians he was speaking to
this week in London were interested in opportunities for
public-private partnerships, but concerned about possible
nationalisation of the mines.
Outspoken ANC Youth League leader Julius Malema wants to
nationalise mines in the world's largest platinum producer and
seize white-owned farmland.
"Our policy does not provide for nationalisation," Phosa
said. "In a democratic movement, you do not say to people 'shut
up', much as it is an issue which may cause uncertainty."
He said the issue was being researched and would be debated
in the next year, with a decision due in December 2012 when the ANC
holds a major policy setting meeting.
"There are so many poor people in South Africa, but business
will only invest if it can make a profit," he said.
"We do not want to scare away investment, we need to find a
win-win solution."
The ANC initiated disciplinary action against Malema in
August, charging him with sowing dissension in its ranks. It
postponed proceedings which could determine his political fate.
Phosa, who defended Malema at a previous disciplinary
hearing, declined to speculate on the outcome of the current
hearing, or on any leadership challenge to President
Jacob Zuma
in internal elections next year at the major ANC gathering.