The Congress of South African Trade Unions (Cosatu) said at the weekend that it was disturbed by the latest Statistics South Africa's report showing that formal employment had dropped by almost 1% in the third quarter of 2003. This loss of almost 60 000 jobs were found mostly in manufacturing, construction and business services, while some gains were recorded in the retail sector.

"The job losses clearly result, in large part, from the overvaluation of the rand, which goes hand in hand with very slow growth in the economy, at just over 1% in the last quarter," the federation said in a release.

Cosatu renewed its call to government to take action both by acknowledging that the rand was overvalued and by substantially reducing interest rates.

"With inflation now at around 4,5%, the real interest rate is well over 5%, which slows the economy overall and attracts a speculative inflow of foreign capital, pushing up the value of the rand," it stated.