Eastern Cape Finance MEC, Pumulo Masualle, says the recent industrial action in the automotive manufacturing sector had dampened growth prospects in the province.
Presenting his Medium Term Budget Policy Statement and Adjustment Budget in Bhisho on Thursday, Masualle described the economic outlook for the province in the rest of the 2013/14 financial year as moderate.
He said that over the "over the past five years the provincial economy had grown at an average rate of two percent, which was in line with the current national growth rate.
"Competition pressures in industries exposed to trade and weak domestic demand are translating into softer medium-term employment growth forecasts for the province."
Masualle added that agriculture remained an "insufficiently exploited comparative advantage¨ for the Eastern Cape "given its vast land and high levels of unskilled labour.¨
He said that given that the projected economic growth was "not strong¨ there was a need to focus on five priorities, one of which was gearing the province for food production and rural development, for which R2.3 billion had been provided over the next three years.
Masualle said the second priority was human capital with R71 billion being provided for Education over the next three years, while investment in the industrial development zones and the training and development with which they were involved contributed to the government's long-term strategy.
Masualle said the other focus areas would be infrastructure delivery, addressing the challenge of unemployment and fiscal management.
The MEC presented an Adjustment Budget of R2.1 billion of which R521 million will go to Health and R470 million to Education that would be used for the rehabilitation of storm-damaged schools and the roll-out of basic infrastructure.
In addition, R366.5 million has been allocated to Economic Development, Environmental Affairs and Tourism for among other things, the shale gas exploration project and the Home of Legends initiative.
(Source: Metrominute - to subscribe mail metminutes@iafrica.com)
