Accessibility links

Breaking News

South Africa Unveils $3.2 Billion Stimulus Plan

South Africa's government has unveiled a $3.2 billion stimulus plan aimed at boosting industrial output and creating jobs in sub-Saharan Africa's largest economy.

Finance Minister Pravin Gordhan announced the six-year package during his mid-term budget speech in Cape Town on Tuesday.

South Africa's Finance Minister Pravin Gordhan (File)
South Africa's Finance Minister Pravin Gordhan (File)

Gordhan said the government's key challenge is to make South Africa more competitive to protect it from global economic turbulence.

He emphasized the government must also reduce chronic and widespread corruption.

The finance minister blamed the European debt crisis for South Africa's slowing economy. Gordhan slightly lowered the country's economic growth forecast for 2011, from 3.4 percent down to 3.1 percent.

Over the six-year period, the government projects it will increase its deficit to 40 percent of gross domestic product, a projection some economists say is too modest, and suggest the figure is more likely to rise to 60 percent.

Some opposition politicians say before embarking on the stimulus, the government should first look to reducing expenditure by tackling corruption and waste at all levels of government.

Some information for this report was provided by AP, AFP and Reuters.