SA saving rate among lowest in the world

CAPE TOWN - Feb 23 2005 14:23

South Africa's savings rate is among the lowest in the world, according to the Budget Review, tabled by Finance Minister Trevor Manuel on Wednesday.

The document says savings in the country dropped from 16,2% of gross domestic product (GDP) in the third quarter of 2003, to 14,7% of GDP in the third quarter of 2004.

Household savings had remained at about 2,5% of GDP since the beginning of last year, while corporate savings increased to 12% of GDP in the third quarter, from 11,7% in the third quarter of 2003.

Government's contribution to gross savings remained about 0,2% of GDP.

On May 24 last year, government launched a retail bond as a risk-free, no-cost savings vehicle for households. By the end of January this year, R1,2-billion had been invested in these bonds.

Of the 15Â 261 investments made, 20% were in bonds that cost between R1Â 000 and R5Â 000. - Sapa

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