South African Deputy Finance Minister Mcebisi Jonas has stressed the importance of the country preserving its sovereign credit rating.

“The first and important task of this collective leadership is to unite to preserve our sovereign credit rating. We have no choice but to remain optimistic,” he added when addressing the 2016 Association of Black Securities and Investment Professionals (ABSIP) Financial Service Conference here Tuesday.

A team from international rating agency Moody’s will arrive in South Africa next week to review the country’s credit rating.

Jonas said South Africa needed to build a faster growing and more inclusive economy. The country must continue to build on its strengths to realise its economic objectives, he added.

“We have strong institutions and a robust legal framework. We have well developed and deep capital markets. Our share of gross domestic product (GDP) spending on infrastructure exceeds that of most other economies.” Jonas said.

“We still have a good environment for business compared with many of our peers and we are witnessing a renewed vigour from government, business and civil society for economic reforms.”

He said the country should be obsessed with renewed growth and vigorous industrialisation, based on reducing growth constraints and fostering new technological capabilities which will grow employment, incomes and exports. The country should also focus on education and skills development.

“Exceptional leadership within government, business, labour and civil society will be necessary to remobilise society as a whole behind this national project, and to extract the kind of concessions and compromises necessary. New institutional mechanisms for collective socio-economic governance and accountability will have to be developed as a matter of urgency,” Jonas said.

Urgent action needs to be taken among relevant ministries and State-owned enterorises (SOEs) to remove constraints to growth.

“Already many of these actions have commenced, including reducing high cross-border costs (including port tariffs), addressing electricity supply issues, as well as addressing regulatory bottlenecks and labour market constraints, especially labour unrest,” he said.

“We are alleviating infrastructure constraints and bottle necks through allocating 865 billion Rand (about 64.4 billion US dollars) over the Medium-Term Expenditure Framework (MTEF) to improve infrastructure.”

He said government was working with municipalities to improve the ease of doing business, and the country had established a one-stop shop, Invest SA, to co-ordinate investment promotion, facilitation and aftercare at a national level. Invest SA will also ease delays for investors in obtaining visas, licences, permits, registration and approvals.

“We must address barriers to entry and deliberately enable increased black ownership of the economy. But this must be done through enhancing productivity and competitiveness, so that as we address anti-competitive behaviour among cartels, we do not negatively affect output, jobs and exports,” said Jonas.

A key initiatives being driven to enable Black ownership of businesses includes using the Public Investment Corporation to inject 70 billion Rand into agriculture, mining, manufacturing, infrastructure and energy.

Source: Nam News Network

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