Return of business confidence augurs well for the future: Kganyago

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Reserve Bank Governor and newly appointed chair of the policy steering committee of the International Monetary Fund believes a return of business confidence augurs well for the future of the country’s economy. Lesetja Kganyago was speaking on the sidelines of the IMF World Bank meetings in Washington.

Kganyago says, “What had constrained the growth in the economy over the past two or three years had nothing to do with the global economy because the global economy was growing stronger than we had seen. It had to do with our own idiosyncrasies and those idiosyncrasies were created by political uncertainty and policy uncertainty and now what you are seeing is we have political uncertainty behind us, the government is injecting policy certainty.”

Meanwhile, Finance Minister Nhlanhla Nene on his first visit to the IMF World Bank meetings in Washington since his reinstatement in February says he has hit the road running reconnecting with old colleagues and stakeholders as the issue of unemployment in emerging economies has topped the agenda.

Nene joined ministers and central bank governors from the G20 in closed door discussions where inclusive growth and low levels of job creation in emerging economies were put front and centre.

“Issue of unemployment which we are confronted with as a country and as emerging economies are at the top of our agenda, so inclusive growth becomes part of our agenda collectively and as we move on also, we are beginning to look at what are the key areas where we could actually find each other.”

He warned of headwinds a possible trade war in light of unilateral protectionist policies, managing the national debt at sustainable levels and stabilizing the country’s State Owned Enterprises.

“If you look at Eskom which is our largest in terms of being a heavy drain on the Fiscus in terms of the guarantees but at the same time looking at how the company itself continues to execute its mandate. You now have a new board, new executive and all the people involved in corruption are beginning to face the consequences. All of those things are happening in a short space of time but that’s putting in place the right fundamentals before you move on.”