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SA’s growth, job targets achievable – advisor

JOHANNESBURG – South Africa’s government is confident of achieving its 6 percent economic growth target by 2010 and halving unemployment and poverty by four years after that, presidential advisor Alan Hirsch said on Wednesday.

“We believe our goals are achievable and we

can surpass many of them because we are at the confluence of positive trends,” Hirsch told a diplomatic luncheon.

The government wants to raise the annual average growth rate to 6 percent from 4.9 percent now to halve poverty among the country’s black majority and cut a jobless rate of more than 26 percent by 2014.

The targets were set under the U.N. Millennium Development Goals.

Currency volatility and an acute skills shortage have been identified as some of the obstacles to faster growth in Africa’s largest economy.

Relative rand strength is blamed for eroding exports and corporate profits, particularly in the key manufacturing and mining sectors.

Hirsch said the rand, which has rallied from a historic low of 13.85/dollar in 2001, has been much more stable over 2005. The rand has gained about 4.6 percent against the dollar so far this year. It was trading around 6.0565/dollar on Wednesday.

“We belive that if it (volatility) can continue to be reduced the rand will be stable and set a long term benchmark, on which people can make investment decisions around,” he said.

The government’s growth strategy will also target the tourism sector. The sector accounts for about 8 percent of gross domestic product (GDP).

“We think this can go to 12 or 13 percent of GDP, which will add another 400,000 jobs,” said Hirsch.

Speaking at the same luncheon, Deputy President Phumzile Mlambo-Ngcuka expressed concerns over delays in the issuing of work permits and visas to allow skilled professional to work in the country.

South Africa is facing an acute shortage of skills, crucial to the attainment of faster growth. The government launched a programme to attract scarce skills in March.

“This is a systemic issue. It’s a problem for people to either work here or for companies to sign the kinds of contracts they would like to sign,” said Mlambo-Ngcuka. — Reuter

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