Finance Minister Pravin Gordhan said on Wednesday local banks remained fairly stable in the face of Europe’s debt woes and did not need the level of regulatory reform required elsewhere.
But Gordhan told a media briefing ahead of this weekend’s G20 summit in Toronto that Africa’s biggest economy would have to look for other trading partners, as existing key markets were likely to be affected by the present crisis.
Gordhan said one challenge facing the G20 meeting was how to return to a coordinated effort in grappling with the crisis without undermining global economic growth. The meeting should, however, not prescribe a uniform formula for all countries.
“We believe that while there has to be coordination there doesn’t have to be uniformity. South Africa, together with Canada, Australia, India to a point, have a common belief that our banking systems and financial systems are fairly secure,” Gordhan said.
“We don’t have to impose the same levels of capital liquidity and other forms of strictures on our banking and financial systems as the rest of the world has to.”
He said South Africa was “a bit concerned that the level of coordination that we saw initially at the G20 is not the level of coordination that we are seeing now”.
South Africa, like other countries, would have to answer tough questions on how to restructure its economy to be more competitive, while also exploring new markets.
“Europe no doubt is our major trading partner, and part of the restructuring that we will have to do is to look for trading partners elsewhere in the world, where there are higher levels of growth, higher levels of demand,” Gordhan said.
One of the challenges the domestic economy faced was creating jobs, Gordhan reiterated, adding that recent employment numbers which show joblessness ticked up in the first quarter of this year were “depressing”. — Reuters