Unemployment and the Euro crisis are the biggest threats to the South African economy in 2012, the International Monetary Fund's managing director Christine Lagarde said on Friday.
Speaking in Pretoria at the start of her two-day visit to South Africa, Lagarde said South Africa needed to “be alert to the spill-over from the Euro”.
Lagarde, who was expected to meet President Jacob Zuma in Bloemfontein during her trip, said: “2012 will be no walk in the park.”
However, she believed the South African government's focus on unemployment and labour-intensive job creation was the correct policy. Attempts to deal with youth unemployment were not isolated to South Africa, but a global issue.
“It is critical (to address youth unemployment), not just for economic reasons, but for the social fabric of countries.”
The promotion of trade within Africa was “a good project to have”, but she cautioned that this should not come at the expense of existing trade with traditional trading partners, including Europe. - Sapa