South Africa needed sustainable economic growth of at least five percent to the Gross Domestic Product (GDP) in order to get out of the negative economic climate, Finance Minister Malusi Gigaba said on Friday.
He addressed a business breakfast organised by the Progressive Business Forum (PBF) at the African National Congress (ANC) policy conference taking place in Johannesburg.
Gigaba said the country’s economy needed to be further transformed to benefit the majority, who were poor and black.
”In a growing economy, a transformation state can use government revenue to invest in human capabilities through education and training, as well as science and technology, which would improve growth capacity. We need to achieve a GDP growth of five percent and on a sustainable basis,” he told delegates.
”Over the last five years, our economic growth has been under two percent, this level of growth is insufficient…we are under-performing and are barely scratching the surface of our economic potential.”
Gigaba added that government was on a path to implement radical economic transformation to benefit all sectors of society. Government had to do much better in ensuring economic growth, he said.
South Africa’s economy has been stagnant in recent times, while unemployment has risen, with mostly the youth affected by joblessness. The country’s credit outlook was further downgraded, leaving the economy in a technical recession.
Gigaba said government might need to implement quotas should all measures fail to yield results.
”Unless we take drastic measures now and harness all our domestic resources, we will not escape the low growth trap….and should the main indicators continue to disappoint any further, we may have to seek assistance from quotas, which we have thus far avoided.”