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Transformation about improving lives of majority and not enriching a few: Gordhan

Without a growth strategy‚ SA would not get the revenue that it required for job creation and the potential for economic inclusivity‚ Finance Minister Pravin Gordhan said on Thursday.

The minister briefed members of four parliamentary committees on the 2017/18 budget which he tabled in Parliament on Wednesday.

“The low growth trap that we are finding ourselves in is not helping‚” Gordhan said.

“If the growth engine does not kick in‚ then transformation becomes more difficult‚” he added.

Transformation had to mean improving the lives of the majority and not the enrichment of the few. Transformation also meant deconcentrating SA’s very concentrated and less efficient economy.

A new economic model and the restructuring of the economy were needed‚ Gordhan added.

Treasury director general Lungisa Fuzile said in his briefing that the budget played a central role in transformation “by promoting redistribution and directing scarce resources towards catalytic investments in human and physical capital”.

“The budget is highly redistributive but stronger economic growth is needed to sustain the fiscal position‚” Fuzile said.

“The projected rate of economic growth is insufficient to reduce unemployment‚ inequality and poverty.”

Treasury has forecast growth of 1.3% this year‚ 2% next year and 2.2% in 2019. Fuzile said these forecasts were underpinned by the depreciation of the rand would help exports‚ commodity prices were on the rise‚ the drought seems to have been broken and the electricity situation has stabilised.

“The 2017 proposes several difficult trade-offs to safeguard citizens’ quality of life‚ improve the efficiency of spending and ensure that the public finances are sustainable‚” he said.

 

TMG Digital

 

 

 

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