JOHANNESBURG- Malusi Gigaba, the minister of finance delivered his budget speech in Cape Town on Wednesday where he highlighted government would implement Radical Economic Transformation (RET) to address the triple challenges of poverty, inequality and unemployment.
“To achieve these goals, we have to implement radical socio-economic transformation. It would be remiss of me not to acknowledge that last year was particularly difficult for our economy. The year was characterised by slow economic growth, recession, ratings downgrades, and heightened concerns regarding the governance and sustainability of key state-owned companies,” he said.
He revealed that the country’s economic growth outlook has improved over the past few months because of strong growth in the primary sector of the economy – particularly agriculture – as well as a welcome recovery in investor sentiment and business confidence.
“Over the medium term, the growth outlook is higher than projected in last year’s MTBPS. The cyclical recovery is matched by a renewed sense of optimism that the government can and will do its work effectively. This presents an opportunity for us to do the things required to reignite growth and chart a course towards meeting the objectives of the NDP and fulfilling our constitutional obligations,” he said.
He suggested that governments responsibilities in translating this renewed energy into tangible and sustainable economic benefits for all South African’s include:
- Creating the right environment for investment,
- Partnering with the social partners to create sustainable employment,
- Dealing decisively with governance and financial failures at state owned companies; and
- Addressing the concentrated and inequitable structure of the economy.
“Achieving these objectives will require us to forge a new compact between the social partners. We need to provide investors with the certainty required to increase investment,” said Gigaba.
In addition, he said the level of investment and improving the ease of doing business in the country will support job creation.
“Private sector investment and job creation are critical to reducing unemployment which remains stubbornly high at 26.7 per cent,” he said.