Manuel dismisses reports of economic slump

Manuel has dismissed as sensationalism reports that the country is experiencing an economic slump

Finance Minister Trevor Manuel has dismissed media reports suggesting the country is going through an economic slump. Manuel says an article in a daily business newspaper misrepresented Rand Merchant Bank's business confidence index.

The index shows a drop from 67% in the last quarter of last year, to 48% in the first quarter of this year.

Responding to a question in the National Assembly by Independent Democrats leader Patricia de Lille, Manuel said the index does not refer to the current electricity crisis as stated in the news article.

Manuel says there is no talk of a slump in the survey. "In fact 50% is a reasonable mark that you would get in most countries."

According to the newspaper's report, the economic downturn had "started to bite", the index painted a "gloomy picture". International developments added to the "misery", oil prices, the sub-prime market crisis fallout and fears of a recession in the USA had "rattled business". The ANC's recent leadership change and the Eskom crisis "further blackened the mood".

Manuel says there is no mention of Eskom in the survey. He also questioned whether the survey could be interpreted to indicate that "growing jitters about political uncertainty" added to the "sombre mood". - Additional reporting by Sapa