DURBAN - Finance Minister Tito Mboweni highlighted crucial talking points and decisions that South Africa needs to make to improve its economic growth prospects and successfully manage the country’s economy out of the technical recession said The Durban Chamber of Commerce and Industry on the 2018 Medium-Term Budget Policy Statement.
The revised growth forecast for South Africa from 1.5% to 0.7% in 2018 is a concern said the DCCI. However, they are looking forward to the planned Investment Summit, as well as other national, provincial and local initiatives, that will encourage investment and stimulate economic activity.
According to the chamber, they support government’s commitment to economic development in townships saying that stimulating economic activity in townships and rural areas will help bridge the gap between the so-called “first” and “second” economies.
The Durban Chamber also supports government’s commitment to empowering emerging farmers, especially farmers focused on export-orientated crops. Greater investment and development in this sector can lead to job creation and wealth creation.
The Durban Chamber is encouraged to hear that government plans to accelerate public-private partnerships and agree that in order for these projects and initiatives to operate properly and to be successful there need to be concrete terms of reference as well as service level agreements.
The Durban Chamber believes that public-private partnerships stimulate economic growth by mobilising private capital and improving the efficiency and use of available resources in a more effective manner.
The broadening of the list of zero-rated VAT items will significantly help low-income households and restore the dignity of people according to the chamber.
The Durban Chamber looks forward to greater details from government regarding how it will recoup the revenue loss of R 1,2billion (from zero-rating these items).
The Durban Chamber expressed concern on the repeated bail-outs of SOEs and urged government to urgently repair SOEs in regards to instituting proper corporate governance and management.
The chamber added that the institutions represent critical state infrastructure and cannot be left to function in chaos and fall into mismanagement. SOEs need to create added value to the nation and not be a drain on the fiscus.