Parliament, Cape Town - South Africa needs to grow its economy at more than five percent a year to be able to create jobs, President Jacob Zuma said on Thursday.
Zuma told MPs the weaker exchange rate would make government's infrastructure programme more expensive.
“We are still going through a difficult period. Developments in the United States economy have led to a rapid depreciation in the emerging market currencies, including the rand.”
Last year, the rand depreciated by 17.6 percent against the US dollar.
“The weaker exchange rate poses a significant risk to inflation, and will also make our infrastructure programme more expensive.
“However, export companies, particularly in the manufacturing sector, should take advantage of the weaker rand and the stronger global recovery.”
Zuma said the country would be able to cope with “this period of turbulence”. It had done so before in the past five years.
“We will, in fact, emerge stronger if we do the right things. We have to work together as government, business and labour to grow our economy at rates that are above five percent to be able to create the jobs we need.”
In his State of the Nation Address President Zuma told MPs government had evaluated the risks and opportunities involved in extracting shale gas, a process known as fracking.
"Having evaluated the risks and opportunities, the final regulations will be released soon and will be followed by the processing and granting of licences.
"The development of petroleum, especially shale gas, will be a game-changer for the Karoo region and the South African economy."
"Our incentives to boost manufacturing have yielded returns. The automotive investment scheme that was launched in 2009 has approved a total R3.8 billion worth of incentives for about 160 investment projects."
The companies would develop sedans, minibus taxis, and buses. The clothing, textile, leather and footwear sector, which had been shedding jobs, had been stabilised, Zuma said.
"Several industries have been designated for local content. These include buses, canned vegetables, clothing, textiles, leather and footwear, and other goods."
There were concrete examples of the success of the localisation programme.
"In the past two years alone, more than 20 000 minibus taxis and 330 buses were assembled locally, drawing investment and development to our cities."
Over the next five years, the state would procure at least three-quarters of its goods and services from South African producers, Zuma said.
This benefited more than 200 000 families, he said.
"Nearly 80 000 land claims, totalling 3.4 million hectares, have been settled and 1.8 million people have benefited.