South Africa could achieve six percent economic growth before the government’s target date if its policies were rapidly implemented, the International Investment Council (IIC) said on Sunday.
”Countries such as South Africa and Brazil are perfectly situated to take advantage of the opportunities generated in the world economy as a result of the growth in China and India,” Trade and Industry Minister Mandisi Mpahlwa said at a media briefing in the Pilanesberg National Park.
Council members suggested that remaining barriers to growth, such as skills shortages, regulations and infrastructure, should be dealt with more quickly.
President Thabo Mbeki established the IIC in 2000 to draw on the insight of international business leaders on how to meet South Africa’s growth and development challenges.
Mpahlwa said the council agreed that regulations required for business needed to be simplified as much as possible. The investment climate survey — the final report of which was presented to the IIC — however indicated that the burden of
regulations on businesses was not that great in South Africa.
”Overall, the investment climate survey was quite positive in terms of the South African economic environment.”
The biggest challenge facing the country’s economy was the shortage of skills, while corruption was ”no concern at all” said Mpahlwa.
Crime was a concern to businesses only in terms of the cost of security systems and guards.
Council member Percy Barnevik, who is chairperson of the board of Astra Zeneca, said that while the second economy was often seen as a ”drag on growth”, increasing micro-credit and training one million women in small enterprises over a period of five years could increase growth between one and 1,5%.
Chairperson of Reuters, Niall Fitzgerald, said South Africa had an enviable record of macro-economic success.
”From a macro-economic standpoint, South Africa can easily accept more risk in the way it pursues development,” he said.
The country needed to move beyond planning for growth and get on with doing, he said.
”We need to stop talking too much about the planning and get on with the execution.”
A ”radically higher” priority needed to be given to the development of human capital, combined with a determined drive to simplify regulations, Fitzgerald said.
Frank Savage of Savage Holdings said the number of small, medium and black-owned companies in the economy needed to be increased, with government providing capital stimulus.
The government however needed the help of the private sector as the public sector could not do it alone, Savage said.
Chief executive of the Areva Group, Anne Lauvergeon, said obstacles facing action on climate change were the diverging visions of those countries who had signed the Kyoto protocol, and the United States, which had not.
”We have a lot of risks. Firstly to speak and do nothing, then the fight against different visions.”
She said SA and the rest of the G5 — Brazil, Mexico, China and India — could play a ”strategic role” in this situation.
In terms of energy, the easy times for developed countries were over, while developing countries had never experienced such times.
Referring to worldwide energy consumption, she said: ”We have to decide collectively to be a little bit more reasonable.
”We are only at the beginning of the beginning of actions. South Africa, as a symbol of sustainable development, could play a special role,” Lauvergeon said.
The three-day council was attended by the chief executives of several international companies and South African government ministers.
President Thabo Mbeki offered his condolences to the Nigerian President Olusegun Obasanjo, his government and the Nigerian people, following the death of Obasanjo’s wife Stella (59) after surgery in Spain earlier on Sunday, and the deaths of more than 117 people in a plane crash in Oyo State, north of Lagos. – Sapa