South Africa's growth projections 'enviable'

South Africa’s projected 3.7 percent GDP growth for 2008 was “like gold” in the current economic environment.

Lesetja Kganyago, Director General in the Treasury, said that in a climate where the world’s seven richest nations may record zero or negative growth for 2009, South Africa’s growth, while slower than initially predicted, was still enviable.
“A projection from 4 percent to 3.7 percent is like gold,” said Kganyago.

In his budget speech, the country’s finance minister Trevor Manuel had cut growth forecasts, but emphasised that South Africa was still in a relatively comfortable position when compared to other economies.

The medium-term budget policy statement dropped South Africa’s GDP projections in 2009 to just 3 percent from the 4.2 percent expected in February as slower global conditions bite.

GDP was projected to grow by about 3.7 percent for 2008, but to rise to 4.0 percent for 2010 and 4.3 percent for 2011.

Kganyago added: “The prophets of recession [in South Africa] have lost their congregation.”

Kganyago noted that for investors in South Africa that the effect of the current global crises would only be felt next year, but added that “we think we have built the anchors and in the outer two years will be back to 4% and more.”