Private sector participation needed for a jobs-led economic recovery: Dr Jammine

Chief Economist at Economentrix Dr Azar Jammine says government will need increased private sector
participation to achieve a jobs-led economic recovery.

His comments come as President Cyril Ramaphosa is expected to hold a virtual meeting with the National Economic Development and Labour Advisory Council on progress on the finalisation of a national economic recovery plan.

Jammine says the private sector will always be reluctant to invest in government projects if it has no say on how to run them.

“Different investments have different requirements as far as employment goes and it is extremely difficult to dictate from the outset that you’re going to create so many jobs etc with these projects. Clearly there’s a lot of influence by the trade union movements to try and sell the ideas to their members but really at the heart of the problem is a lack of capacity to implement a lot of these projects.”

Economy 

Earlier this month, Statistics South Africa announced that the Growth Domestic Product shrunk by 51 %  in the second quarter.  Nearly all industries experienced a massive drop in output.  The construction industry was hardest hit, slumping by 76.6%.

It was already in bad shape before the pandemic. This was the sector’s eighth consecutive quarter of economic decline. Manufacturing output shrank by 74.9% due to work stoppages and low demand for steel.

The lockdown to curb the spread of the coronavirus played a role in the figures: