Cape Town - Finance Minister Enoch Godongwana has warned that the latest figures that unemployment has grown from 34.4% to 34.9% show that the economy is under pressure and a constrained environment.
He told Parliament on Tuesday during the adoption of the Budget that the economy was facing a number of challenges and yet was expected to grow.
He said other than the latest figures by Statistics South Africa of 34.9% unemployment rate in the third quarter, the economy still had to deal with the fourth wave of Covid-19, which posed another threat.
Its impact had not yet been felt, but it would be a major threat.
Godongwana said they needed to pull together to get the economy out of the woods.
“This debate takes place against the backdrop of major economic challenges facing our nation. Statistics South Africa today has revealed that unemployment continues to grow. We are sitting at about 34.9%. We are having this debate in a constrained fiscal outlook.
“Coupled with these is the resurgence of the fourth wave of the Covid-19 pandemic. These are the challenges facing our nation. The consequences of this fourth wave from a fiscal perspective are unknown,” said Godongwana.
He said they were trying to strike a delicate balance to grow the economy.
“That delicate balance we are trying to achieve is to save lives, protect the vulnerable and grow this economy so that we could make an impact on unemployment, poverty and inequality. We have got to do all of this in a manner that is sustainable,” he said.
He said this included structural reforms in the economy.
Once the government implemented structural reforms, it would kick-start the economy, said Godongwana.
He also stuck to his guns on state-owned entities, saying the government had pumped in billions of rand over the years, but nothing was achieved.
He reiterated that there would be no bailouts for SOEs.
He said this was tough love and indicated a shift from how the government had been handling SOEs.