With significant reduction in loadshedding throughout most of the year’s second quarter, the African National Congress (ANC) noted on Wednesday that it was positive about the prospective gross domestic product (GDP) for the third quarter.
The party welcomed the “modest but better than expected” growth of 0.6% in the second quarter, which followed a growth of 0.4% in the first quarter.
“We welcome the rise in fixed investment spending (gross fixed capital formation) in the quarter by +3.9% largely driven by rises in investments in machinery and other equipment,” said the ANC.
The party said this shows that firms are beginning to invest in tooling and growing installed capacity.
The ANC noted that the manufacturing industry increased by 2.2% and contributed 0.3% to the GDP growth, the finance industry increased by 0.7% and contributed 0.2%, while the agricultural industry increased by 4.2% and contributed 0.1%.
The party welcomed this growth and noted that this was primarily owing to increased economic activities reported for field crops and horticulture products which are the most labour-intensive segments of agriculture.
The ANC explained that the reforms undertaken by government remained crucial in unlocking a period of sustained economic growth that could yield the economic and market activities that would ensure the country made meaningful progress in addressing poverty, inequality and unemployment.
“A critical feature of these reforms requires prioritisation of an aggressive social and economic infrastructure programme, as the Economic Reconstruction and Recovery Plan suggests,” the party said.
Furthermore, it required meaningful reform in unlocking constraints to investment, and economic and social activity through reform of local government through the District Development Model, it added.
“Rebuilding our network industries (and the State-owned entities who function as lead firms in these industries), encouraging localisation and export growth, moderating the impact of administered prices on firm and household-level activity, all while protecting the consumption baskets of the most vulnerable through meaningful access through social transfers and indigent programmes - in this way, we will ensure our growth is inclusive, and that no one is left behind in the economic recovery that the ANC is pursuing, which is aimed at ensuring a better life for all,” the ruling party said.