Business Unity SA (Busa) has welcomed the overall thrust of the Organisation for Economic Cooperation and Development’s (OECD) economic assessment of South Africa.
The report reflected ”a realistic grasp of the socioeconomic priorities that should prevail in helping to shape the future economic and business environment in this country”, Busa said on Wednesday.
The OECD released its first economic study of South Africa on Tuesday.
Its report issued warnings on the country’s current account deficit, education, unemployment and lack of competition.
Busa said some recommendations might require further debate, but the crux of the OECD appraisal correctly supported the government’s shared growth initiative, AsgiSA.
The OECD made key recommendations for bolstering the programme and introducing it speedily, Busa said.
The persistence of high unemployment, mostly in one segment of the population, gave urgency to the promotion of labour-intensive growth through AsgiSA.
The OECD report was ”particularly timely at a stage when SA, in common with many other countries, is also grappling with the global economic slowdown and associated financial volatility”, Busa said.
It agreed with the OECD on the current account deficit.
”Busa agrees that at present the large current account deficit is the main source of macroeconomic vulnerability for SA and is partly a reflection of years of relatively weak export performance.”
South Africa clearly had to accord a much higher priority to innovative ways and means of strengthening its global competitiveness.
Busa also agreed South Africa could benefit from a strategy to increase competition, including a more competitive-friendly regulatory framework, especially for small businesses.
It said decision-makers in the public and private sectors who wanted to see AsgiSA’s socio-economic goals realised by 2014, should seriously study the OECD’s recommendations.
The OECD is an international organisation made up of 30 countries that accept the principles of representative democracy and free-market economy.
It was formed in 1948 as the Organisation for European Economic Co-operation (OEEC), led by Robert Marjolin of France, to help administer the Marshall Plan, for the reconstruction of Europe after World War II. – Sapa