Johannesburg - Cosatu is flabbergasted by the International Monetary Fund's (IMF) latest report on South Africa, spokesman Patrick Craven said on Wednesday.
“It lays the blame for the poorly performing economy of South Africa, on 'the government’s poor record in controlling the wage bill and potential spill-overs from high wage demands in other sectors represent downside risks',” he said.
“It is thus blaming the world capitalist crisis, brought about by the IMF’s own neoliberal ‘free-market’ capitalist policies, and the shocking levels of unemployment, poverty and inequality which this has caused in South Africa and elsewhere, on the main victims of that crisis - the workers and the poor.”
The IMF released its Article IV report on South Africa on Tuesday.
It was compiled after consultations between the country and the IMF between May 22 and June 4.
The IMF holds bilateral discussions with its members every year.
In the report, it raised issues about the economy, growth and job creation.
The report called for social bargaining, which should include “wage restraints” in return for hiring commitments, measures to enhance product market competition, and improved public services.
Craven said: “This in essence, means an 'egg and bacon' agreement, where the business 'chicken' commits to lay eggs for breakfast and calls on the worker 'pig' to lay down its life to supply the bacon.”
This would lead to a downward spiral of the already meagre living standards of most workers, bringing lower levels of demands for goods and services, which would lead to more jobs being lost.
Craven said the IMF's view was at odds with research done by the International Labour Organisation, which argued in favour of a wage-led growth strategy which was likely to generate a more stable growth regime for the future.
The Congress of SA Trade Unions (Cosatu) urged the government not to be misled by the IMF's policies.
“Rather stick with the ANC’s proposal for a radical economic programme for the second phase of the transition, and engage with the economic proposals tabled at the recent alliance summit, on which there was considerable agreement between Cosatu, the ANC and SACP,” said Craven. - Sapa