Reducing public-sector wage growth is the only policy option that can offset reduced revenues according to the Institute of International Finance
The SA government needs to achieve “credible” fiscal consolidation, notably by reducing public sector wages, if it wants to boost business and consumer confidence enough to improve growth in the coming years, the Institute for International Finance — the global association for the financial industry — said in a report on Monday.
In an optimistic scenario, slower growth of the public wage bill would improve business and consumer sentiment even more, and economic growth could reach 1.6% and 1.8% in 2021 and 2022, respectively, the institute said. Mboweni said SA needs to achieve R150bn in savings over the next three years to stabilise government debt levels. Much of this is expected to come from savings on the wage bill, but public-sector unions have rejected moves to reduce the salaries of public servants.
The country is only expected to grow by 0.5%, as per National Treasury forecasts, rising to 1.2% in 2020, and 1.6% and 1.7% in 2021 and 2022, respectively. The institute warned that recent bouts of load-shedding, that saw Eskom cut an unprecedented 6,000MW from the grid on December 9, have worsened the outlook for growth.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
SA needs credible fiscal consolidation for confidence and growthReducing public-sector wage growth is the only policy option that can offset reduced revenues according to the Institute of International Finance
Read more »
STUMPS | SA reach 277-9 on first day against EnglandQuinton de Kock scored a defiant 95 off 128 to help South Africa to a respectable score of 277/9 at stumps of day one of the Boxing Day Test at SuperSport Park in Centurion on Thursday.
Read more »
De Kock fights back for SA against EnglandSouth Africa were in deep trouble at 111 before Quinton De Kock and new cap Dwaine Pretorius put on an unbeaten 76 for the sixth wicket.
Read more »
Injured photographer delays play on first day of SA-England test matchPhotographer Christiaan Kotze became part of the story on Thursday when he was injured in front of the sightscreen and caused a delay to the start of a Test match - and possibly contributed to South African batsman Dean Elgar's wicket.
Read more »
Injured photographer delays play on first day of SA-England test matchPhotographer Christiaan Kotze became part of the story on Thursday when he was injured in front of the sightscreen and caused a delay to the start of a Test match - and possibly contributed to South African batsman Dean Elgar's wicket.
Read more »
Home Affairs blocks Gupta family attempt to renew SA passportsHome affairs minister Aaron Motsoaledi has revealed that some of the Gupta family members have been trying to get their SA passports renewed.
Read more »