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Cape Town - Finance Minister Pravin Gordan told Parliament on Thursday that the weak economy can only be overcome if all role players work together.
Gordhan was addressing Parliament during the debate on Building Collective Action for Inclusive Growth.
He stressed amid interruptions the need for government, business and labour to unite to avoid a ratings downgrade.
“The President has rightly identified that the economy is weak. Investment is depressed, unemployment is rising and volatility in financial markets is extreme,” Gordhan said.
“This is caused by a volatile and uncertain global environment. This cycle of lack of confidence plays out through fear and risk aversion in financial markets.
“We have no choice but to use our resilience and dig deep to map out a common growth forward, building unity between government, business and labour.”
Moodys feedback a ‘major success’
Gordhan said that the Finance Ministry’s international roadshow to encourage investors was ultimately a success, with the country avoiding a ratings downgrade from ratings agency Moody's, for now.
“What we’ve been trying to do over the past few months is build on past initiatives. We have begun to create a new narrative.
“Together with business and labour, the government embarked on a foreign investment roadshow to encourage the world that South Africa was “open for business”.
“Moody's visited (SA) in March for a ratings review, and decided to leave our credit rating the same, which is a major success at this point in time."
Next round of reviews in December
The finance minister hinted that the feedback from Moody's, despite “recent, disruptive political developments”, testified to the strength of South Africa’s institutions.
He also said two other ratings agencies, Standard & Poor's and Fitch, engaged the ministry this week, and “will provide feedback soon”.
The next round of ratings reviews will be in December this year, he added.
“Ultimately, our message is that it’s absolutely important that government, business and labour needs to collaborate.
“There are many sceptics and doomsayers; we can’t let them determine our collective fate,” Gordhan said.
