Deputy President Cyril Ramaphosa says the country’s emergence from a technical recession should encourage government, business and labour to work together.
Ramaphosa was speaking at the annual National Economic Development and Labour Council (Nedlac) summit at Emperor’s Palace on Friday, saying corruption impedes growth and redistribution and therefore it must be rooted out.
He says the country is seeing the first green shoots of what will hopefully be the start of the economy recovering.
“This rise of 2.5% of our GDP is a clear sign that we can, when we’re focused, we can rebuild and we can work together collectively to improve our economy and to grow our economy. This is only the beginning I’d like to believe.”
At the same time, South Africa’s business confidence index fell to its lowest in more than three decades in August as merchandise import and export volumes fell, a survey showed on Wednesday.
The business group said South Africa’s economic performance was sub-optimal despite an positive global outlook, and improved business confidence was needed to revitalise domestic growth.
The South African Chamber of Commerce and Industry’s (SACCI) monthly business confidence index (BCI) fell to 89.6 in August, the lowest level since mid-1980s, from 95.3 in July.
“Lower merchandise import and export volumes mainly caused the sharp monthly decline of the BCI in August 2017. Lower consumer inflation and new vehicle sales made only moderate positive monthly contributions,” SACCI said in a statement.
Africa’s most industrialised economy emerged from recession in June, helped by recovery in agriculture after a drought last year, but political scandals and policy uncertainty still dampen investor confidence.
Since South Africa emerged from the 2009 recession, growth has fallen short of the government’s target of 5%, the level economists say is needed to curb unemployment.
The country is beset by low growth the fallout from credit downgrades, corruption scandals and in-fighting in the ruling African National Congress party which is due to hold elections in December to replace President Jacob Zuma as its leader. Zuma tenure as South Africa’s president ends in 2019.