PRETORIA (Bloomberg) –South Africa is dealing with the fallout of a weak global economy and suggestions that the country is in crisis are unfounded, President Jacob Zuma said.
“I think the globe is in a crisis since 2008,” Zuma told reporters in Pretoria, the capital, on Tuesday. “South Africa is part of that. I wouldn’t say in South Africa it’s doom and gloom. We think we are doing very well.”
Anglo American Plc, Scaw Metals Group and Lonmin Plc are among companies that have announced plans in the past month to cut about 10,000 jobs in Africa’s most-industrialized economy, in response to plunging global metals prices. The economy has also been hamstrung by a shortage of electricity, with the National Treasury anticipating 2 percent growth this year, less than half the expansion the government is targeting to cut a 25 percent unemployment rate.
Growth should accelerate to 3 percent within three years as power constraints that are trimming an estimated 1 percentage point off the growth rate ease, Zuma said. He said job losses, particularly in the mining industry, are “a serious concern” and called on companies and unions to work with the government to help limit them.
The rand fell to the weakest level against the dollar last week since 2001, while platinum, of which South Africa is the biggest producer, has dropped 18 percent this year.
Plans to procure new nuclear plants that will add 9,600 megawatts of electricity to the national grid are at an advanced stage and contracts should be awarded by the end of March, Zuma said. He expects 92 renewable energy projects generating 6,327 megawatts of power to come online over the next 2 1/2 years.
The government acknowledges there are concerns that new rules requiring tourists visitors to apply in person for visas at a visitor center and for all children to carry a birth certificate with full details of both parents may be discouraging tourism, Zuma said. A cabinet committee led by Deputy President Cyril Ramaphosa will look into the matter, he said.