Media Statement: Invest in local micro market to create jobs

ACDP MP and spokesperson for trade and industry Mighty Madasa

6 June 2003

Many will be keeping a keen eye on the upcoming Growth and Development Summit this weekend for sustainable solutions to the economic problems and job crisis facing South Africa.
Unfortunately, due to the character of the free-market economy in South Africa and world wide, full employment is unrealistic in a competitive global economy.

Focussing on economic growth as the solution is short-sighted, as economic growth alone does not so much precipitate more jobs as it increases profits. On the other hand, no or less economic growth causes job losses. Acceleration of growth unaccompanied by micro strategies to ensure development will not be beneficial for a developing country. What is needed is shared growth, not just profitability.

Whilst the government's focus on exports has helped to expand the markets for South African products, it has not translated into benefits for all South Africans. Local manufacturers are often faced with imported goods that are heavily subsidised by their countries of origin, making it difficult for them to compete fairly. Principles of reciprocity should be applied to avoid flooding local markets with cheap, imported goods.

Government incentives should be directed to companies that invest locally and its industrial strategy must support the downstream and labour intensive industries in order to ensure the empowerment of the poorest. Focussing on consumption-related grants such as the Basic Income Grant will not provide the benefits of stimulating local community development and entrepreneurship, which encourages self-reliance and has a broader reach.

More investment, maintenance and the building of infrastructure is crucial to stimulate growth and in order to ensure competitiveness and shared growth and the government must ensure a better co-ordination and spending of all available development funding.


For more information: Mighty Madasa MP at 083 302 4938
Media Liaison: Charmaine Horne at 084 370 3550 or 021 403 3307