SA economy ‘not about to fall off a cliff’, says Pravin

2012-10-25 11:57

Finance Minister Pravin Gordhan has reassured South Africans as well as foreign investors that “there is no catastrophe” awaiting South Africa now or in the near future.

Speaking to journalists ahead of the tabling of his Medium Term Budget Policy Statement in Parliament today, Gordhan’s main message was that the country’s economy “is not about to fall off a cliff” and that South Africa had enough money for the things that needed to be done.

Gordhan this morning slammed the way The Economist recently portrayed the country in an article entitled: “Sad, sad South Africa”.

Although he didn’t mention the publication by name, Gordhan said the impression was created that “everyone of us is carrying a stick in South Africa and walking down the street with these, just like the perception was 20 years ago that there were giraffes in Sandton. That was the characterisation then.”

The Economist article was accompanied by a front-page depicting striking miners.

Gordhan said South Africans should help to change the perceptions around “this hopeless generalisation of our continent”.

“Many of us are optimists and we have survived worse than this,” he said.

He also slammed the recent downgrading of South Africa by a number of ratings agencies, saying: “Nothing is there in the numbers to suggest South Africa is about to fall into fiscal difficulty,” or that anything would “impact on the fiscal trajectory”.

He also said South Africa was in the process of recovering from the “once in 70 year” recession that hit many countries in the rest of the world – something which normally took about 3 to 10 years, he said.

Gordhan also said those outside the country did not understand the “robust debating culture” in South Africa, and the “difference in approach and emphasis” to policy in the country.

He gave the assurance that by December 20, when the ANC’s elective congress in Mangaung finishes, “we would have reached a point where all questions of concern will be resolved sufficiently to provide clarity for us as policy workers and also outside the country”.

He said South Africa was still a good investment destination, reminding investors to “take a 5 to 10 year view” and not just to look at immediate circumstances.

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