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Mboweni ready to 'think outside the box' to boost economic growth

Dec 21 2018 11:55
Sibongile Khumalo, Fin24
SA Minister of Finance Tito Mboweni delivers his m

SA Minister of Finance Tito Mboweni delivers his medium-term budget policy speech on October 24, 2018. ( RODGER BOSCH/AFP/Getty Images)

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Finance Minister Tito Mboweni says there have been questions in Cabinet about whether the country is pursuing the right path in its bid to grow the economy.

Mboweni was speaking on Thursday morning at the opening of a meeting with local and international economists which he convened to discuss ways to boost SA's sluggish economy. SA's economy has registered low growth rates for nearly a decade. 

He told journalists in Pretoria that he hoped the meeting would result in workable strategies to lift the economy out of its slump. 

Mboweni said SA's low growth trajectory had led to some in Cabinet questioning whether Treasury could not ''think outside the box” to find solutions. 

SA's economic growth is projected to come in at between 0.5% and 0.8% in 2018, according to the World Bank, IMF and SA Reserve Bank predictions. 

He said while the colloquium would try to come up with ideas, emotions should be left out of the discussion.

Economic advisory council on the way? 

Mboweni hinted that President Cyril Ramaphosa had raised the possibility of a formation of a “council of economic advisors”. 

“That is just an idea that has come from the president, nothing more has come out of it,” he said.

“The South African economy is not growing at a rate we would like. For us, the most significant challenge is poor revenue collection, which leads to a lot of challenges,” he said.

Poor revenue collection has been linked to the current administration's shortcomings at the SA Revenue Service, although Mboweni did not make any reference to the tax agency's woes.

Among the invited participants are Harvard University economists, Professors Ricardo Hausmann and Robert Lawrence, as well as academics from local universities and business leaders.

Speaking ahead of the closed meeting, Hausmann, who is the Director of Harvard’s Centre for International Development, said South Africa “is a unique country with a unique set of challenges”.

“Growth over the last five years has not been spectacular,” said Hausmann.

Between 2006 and 2008, Hausmann led a panel of international economists which included his Harvard colleague, Robert Lawrence, to advice the National Treasury on measures to accelerate South African growth.

After Mboweni briefed the media, discussions continued behind closed doors. 

national treasury  |  tito mboweni  |  sa economy  |  gdp
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