This week sees the President’s State of the Nation Address and on the 27th the Minister of Finance’s Budget Speech. Yesterday at a media conference, Prof Raymond Parsons, who is also a special policy advisor for BUSA, presented a business perspective on these two events and South Africa’s economic and business outlook.
IOL Business Report has two stories:
Business’ view is that for 2013 the GDP growth rate will remain positive but modest at 2.6% and there are downside risks in the current account deficit, weaker Rand as well as other cost-push factors keeping inflation at the upper end of the target range. South Africa has little control over events in the world economy but we do however have control over domestic policies. Structural problems and labour unrest are having ripple effects through the economy and investor and business confidence is low. BUSA urged the government to build a bigger, stronger economy through the NDP.
South Africa’s public finances are comparatively sound and BUSA asked for a “surprise-free” budget that balances spending on wages and debt service costs with infrastructure rollout, while maintaining fiscal discipline.
The key for SONA and the Budget will be to narrow the gap between talk and action.