Huge investment needed to spur growth in S. Africa: Economists

Johannesburg, Feb 12 (IANS) Economists welcomed the State of the Nation Address (SONA) which focused on addressing challenges hampering economic growth and investment, saying there was a need for huge investments in the economy to stimulate growth."There's a need for a huge investment into the economy to stimulate and unlock economic growth," Duma Gqubule, Economist and Director at the Centre for Economic Development and Transformation said.Gqubule added that the government should be driving investment in the economy to spur growth, Xinhua news agency reported."You have to spend money to get growth. You can't get growth if you're not spending. Business can't invest into an economy that's not growing," he told Xinhua.According to him, there was not enough money to buy the goods that were being produced.He was responding to South African President Cyril Ramaphosa's Thursday evening SONA speech, in which he said plans had been put in place to accelerate the implementation of structural reforms to modernise and transform industries, unlock investment, reduce costs, and increase competitiveness and growth.The speech acknowledges the "electricity crisis is one of the greatest threats to economic and social progress".Ramaphosa promised to tackle red tapes that hindered businesses and economic growth.He said the government has designated a "red tape team" to streamline the processes relating to international trade, property registration and construction permits.The President also said the government was working hard to "modernise" the visa application process to make it easier to travel to South Africa for tourism, business and work.Efficient Group Economist Dawie Roodt told Xinhua that the speech demonstrated the President's awareness of economic problems but doubted whether the state was on track to address them.Labor Federation Cosatu spokesperson, Sizwe Pamla said the state should fix deteriorating state-owned entities (SOEs)."The government needs to urgently work with labor to develop turnaround plans that will help stabilise, save, and rebuild these SOEs," he added."We cannot afford to have workers who are forced to sit for months on end with no pay or the mass retrenchments that are currently taking place in these state companies," he said.
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