During his State of the Nation address at the opening of Parliament today, South African President Thabo Mbeki called for a continued focus on the growth, development and modernisation of the country’s ‘first economy’.

This, he said, would require further and significant infrastructure investments, skills development, scientific and technological research, development and expansion of the knowledge economy, growth and modernisation of the manufacturing and service sectors, deeper penetration of global markets by South African products, increasing savings levels, black economic empowerment and the further expansion of small and medium enterprises.

“We will have to focus on the implementation of the measures we have identified to ensure that we achieve better value for the money spent on social delivery.

“Among other things, our successes with regard to both the ‘first’ and ‘second’ economies must create the conditions for us to reduce the numbers of our people dependent on social grants,” he stated.

Mbeki argued that the focus on growth of the ‘first’ economy would generate the resources to confront the challenges of the ‘second’ economy.

The ‘second’ economy, he pointed out, constitutes the structural manifestation of poverty, underdevelopment and marginalisation in South Africa.

“We must, therefore, move vigorously to implement all the programmes on which we have agreed, to ensure that we extricate all our people from the social conditions that spell loss of human dignity.

“These include the urban renewal and rural development programmes, the expanded public works programme, the expansion of micro-credit and small enterprises, the provision of adult basic education and modern skills, and the development of the social and economic infrastructure,” he explained.

Mbeki further called for a focus on raising skills levels within the public sector, and ensuring its managerial and technological modernisation, driven by a clear understanding of the developmental tasks of the democratic State.

“At the same time, we will still have to contribute as much as we can to the common African effort to strengthen such institutions as SADC (Southern African Development Community), the African Union and Nepad (New Partnership for Africa’s Development) and help ensure that they discharge their responsibilities effectively.

“We must do this work driven by the conviction that we will not allow anything to stand in our way towards the building of a peaceful, democratic and prosperous Africa,” he said.