Economists were generally positive about President Thabo Mbeki’s State of the Nation address at Parliament on Friday, with Colen Garrow, Economist at Brait, saying that the markets should respond positively. George Glynos, market analyst at ETM, said however that the the government should tread carefully on land reform.
Colen Garrow, Economist at Brait
“He [Mbeki] focussed on the usual priorities — taking growth to levels to
absorb the number of people in the economy, infrastructure development
programmes and public private partnership programmes. By and large the speech seems good — there’s a lot of money to be spent — R372-billion on infrastructure development — over the next three years.
“The State of Nation address was pretty strong, so markets should respond positively to it.”
George Glynos, Market Analyst at ETM
“The State of the Nation speech was generally positive, especially the moves to tackle the skills shortage and service delivery. Of concern was the mention of change to land reform. I have no problem with the empowerment of previously disadvantaged individuals, but the government should tread carefully and shouldn’t discourage foreigners from investing in property in this country. There also appeared to be no mention of actively tackling HIV/Aids.
“Overall, the speech was fairly upbeat.”
Elna Moolman, Economist at Standard Bank
“We are slightly disappointed about the amount of detail on the accelerated and shared growth initiative. We were expecting more information and figures on how this will work going ahead.
“At least the government has identified factors that are constraining the economic growth strategy. These include skills shortages, but it’s not clear how exactly they are going to address it. It’s also not clear how they’ll deal with lack of or slow service delivery.
“Input costs — especially telecommunications costs and import parity — have also been identified as constraints.” – I-Net Bridge