Budget Speech: Kholwane points to slow growth as cause for concern

Budget Speech: Kholwane points to slow growth as cause for concern
CONCERNED: Mpumalanga finance MEC Sikhumbuzo Kholwane says the slow economic growth is a cause for concern as it impedes on Government's service delivery program. PICTURE BY MfisoDIGITAL/MLM.

The MEC delivered this year’s budget speech and looked at provincial economic challenges.

Mpumalanga economic development MEC Eric Kholwane has pointed to the slow economic growth, saying the pace at which the province’s economy was growing was very slow and undermined government’s efforts in addressing issues of unemployment, poverty and inequalities .

Kholwane delivered the 2017/2018 budget speech at the Themba Senamela stadium in Middelburg on Tuesday afternoon this week.

He said both global and local economic growths were very slow and many industries “are in distress”, which caused high unemployment in the province and made job creation to be “far below” government’s target.

“Youth unemployment and especially female youth unemployment, is disappointingly high,” Kholwane said.

He said slow economic growth last year impacted seriously and people lost jobs.

“The global economic environment has been unusually difficult, more especially to developing nations such as ours,” he said.

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“There are however signs that a more sustainable economic recovery might be under way,” he said.

He said growing the provincial economy and addressing the challenges of poverty, unemployment and inequality faced by the province should “remain a top priority”.

“Global growth is projected to improve from 3.1% in 2016 to 3.4% in 2017,” Kholwane said.

Kholwane points to slow growth as cause for concern

“There are concerns about the relatively high inflation rate, weak business confidence and challenges in some of the key economic sectors such as agriculture, mining and manufacturing, all which recorded a negative growth rate in the fourth quarter of 2016 according to the latest GDP figures.

“The average annual growth rate for our province for the period 2015 – 2020 remains relatively low at less than 2 percent,” said Kholwane.

He said even though this was the case the provincial economy was expected to grow in accordance with national economic growth-line, “at a rate of more or less 1% in 2017″.

“Bearing this in mind, the economic growth prospects of the province will be heavily influenced by the performance of the mining industry, which contributes more than 25 percent to the provincial economy”.

Kholwane said the slow economic growth in 2016 was worrying and “the high job losses especially in trade, construction, finance and agriculture industries are particularly worrying as they negate our efforts of addressing poverty and unemployment in our province”.

“We are however grateful that some major corporations through strategic partnerships are making a concerted effort to assist in job creation as highlighted in the State of the Province Address,” he said.

(edited by ZK)

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