Deputy president Kgalema Motlanthe has warned that SA dare not fail to harness the economic upswing of the global south to sustain and grow employment opportunities in the country.
Economic trends and the experience of social dialogue point to the need to prioritise employment creation in economic policy, deputy president Kgalema Motlanthe said on Monday.
He was addressing delegates from organised labour, business and civil society, academics, research institutions and multilateral agencies, who were attending the Inaugural Economic Development Conference convened by the minister of economic development, Ebrahim Patel, in Johannesburg.
“In policy terms, the Framework Response to the global downturn agreed between the National Economic Development and Labour Council (Nedlac) constituencies pointed the way toward improved collaboration between stakeholders around economic development.
“The question we now need to ask is to how to sustain this kind of constructive and active solidarity. We need to reflect on and learn from our successes in this critical area of social dialogue,” Motlanthe said.
Global shift
He noted that the conference came at a particularly important time for the global economy, for the past two years had marked a clear shift in international economic relationships.
Motlanthe said the economic model in the global north had led to a sharp economic decline, starting in 2008, and continued instability since then.
“In contrast, the global south saw a relatively rapid and strong recovery, led above all by continued extraordinary rates of growth in China and India.
“For South Africa, this strategic conjuncture brought opportunities and lessons in both the economic and policy-making arenas,” Motlanthe said.
He said in the economy, a relatively rapid recovery in the GDP after three quarters of contraction in 2009 was observed. However, in contrast, both employment and private investment returned to growth slowly.
Employment growth
“Only in the past six months have we seen a return to job creation, with formal-sector employment gains in particular. Still, employment remains about 5% lower than it was two years ago — a situation South Africa can ill afford, given high joblessness even before the downturn,” Motlanthe said.
According to Stats SA’s Quarterly Labour Force Survey released on May 3, South Africa had recorded a 25% unemployment rate in the first quarter of 2011.
While government welcomed the growth in employment, Motlanthe said it must still ask how it could ensure it was more sustainable in the future.
“We cannot continuously create employment in the upturn, only to have massive job losses in downturns wipe out the gains,” he said.
On the one hand, the state must support more and more efficient economy overall, with a capacity to react rapidly to changing conditions and ensuring adequate infrastructure systems, education and social services.
Cutting down on red tape
“For this reason, we have intensified efforts to improve quality education and skills development and committed to high levels of public investment,” Motlanthe said, adding that this was accompanied by a commitment to reduce red tape.
“On the other hand, the state must intervene systematically and consistently to transform exclusionary economic systems and structures that reproduce joblessness and inequality,” he said.
To achieve this end, Motlanthe said government must encourage more labour intensive sectors.
He said in this context, government would support new forms of ownership that empowered people on a mass scale that included both small and micro enterprise, but also collective and social ownership.
“To achieve these aims, given our apartheid history, rural development, overcoming inequalities in education and access to skills and strong support for agriculture, light industry and productive services are particularly important.
“We have a long-standing vision for our society: a non-racial, non-sexist, democratic South Africa in which citizens have decent livelihoods,” Motlanthe said. — Sapa