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06 March 2020 | Story Valentino Ndaba | Photo Stephen Collett
Lesetja Kganyago, Governor of the South African Reserve Bank
Reserve Bank Governor, Lesetja Kganyago, presented a public lecture at the UFS on 4 March 2020.

With a 7% fiscal deficit on the Gross Domestic Product (GDP) projected by the National Treasury for the 2020/21 financial year, it would not take long to arrive at a dangerous level of debt at the rate that South Africa is borrowing. Although the South African Reserve Bank Governor, Lesetja Kganyago, does not consider a debt to GDP rate of 60% a disaster, he did express his concern regarding the country’s fiscal deficits being over 6% of the GDP.

Governor Kganyago presented a public lecture at the University of the Free State (UFS) on 4 March 2020, focusing on how we should use macro-economic policy and its role in our economic growth problem.

Unsustainable policies 
South Africa’s fiscal situation is not about tight monetary policy. According to the Governor: “Weak growth is endogenous in our fiscal problems. We cannot keep doing what we are doing and hope that growth will recover and save us. Growth is low, in large part, because of unsustainable policy.”

Avoiding an impending crisis
To address the problem, as a policymaker with more than 20 years’ experience, the Governor suggested that the recommendations made by Minister Tito Mboweni be taken into consideration. “The Minister of Finance, Tito Mboweni, is a man who says things that are true even when they are unpopular. His message is that we have to reduce spending and he is right to put this at the centre of our macro-economic debate,” said Governor Kganyago.

The state needs a radical economic turnaround strategy which is able to diminish the risk of losing market access and being forced to ask the International Monetary Fund for help. Governor Kganyago is positive that such a reformative tactic would go beyond monetary policy and ensure that the interest bill ceases to claim more of South Africa’s scarce resources. 

News Archive

Summer programme a first outside Austria
2012-12-06

 

Mr Derek Hanekom, Minister of Science and Technology
Foto: Johan Roux

05 Desember 2012

People often fight about their differences, like skin colour, religion and more. “These differences are minute. We must celebrate our common ancestry and commit ourselves to a common destiny. Your work can make a difference.” This is according to Mr Derek Hanekom, Minister of Science and Technology.

He opened the Southern African Young Scientists Summer Programme (SA-YSSP) at the Bloemfontein Campus on Sunday 2 December 2012. The UFS is the first institution outside Austria to host the Summer Programme. A total of 19 young researchers from 17 countries will be hosted by the UFS until 28 February 2013. Researchers in the programme are, among others, from South Africa, Egypt, China, Italy, Sweden, Iran, Hungary, India, the USA and Indonesia.

The programme will form part of an annual three-month education, academic training and research capacity-building programme jointly organised by the International Institute for Applied Systems Analysis (IIASA), based in Austria, the National Research Foundation (NRF) and the Department of Science and Technology (DST). IIASA is an international research organisation that conducts policy-oriented scientific research in the three global problem areas of energy and climate change, food and water and poverty and equity. South Africa’s engagements with IIASA, specifically with regard to the SA-YSSP, relate primarily to the DST’s Ten-Year Innovation Plan.

Mr Hanekom spoke about the impact the growing global population, which is expected to grow from 7 billion in 2012 to 9 billion in 2050, has on natural resources. “We use purified water to flush our toilets while other people do not have clean drinking water. We cannot carry on like this. Somewhere it must stop, if we do not want to be responsible for the 6th great extinction. We must know how our systems impact on each other.

“We can do things differently and better and should endeavour that other people enjoy luxuries we take for granted,” he said.

He urged the researchers to believe that they can make a difference, share knowledge and translate the knowledge into plans.

Prof. Dr Pavel Kabat, Director/CEO of IIASA, said the summer programme was presented outside Austria for the first time, with plans to expand to Brazil and China in future. Twenty countries are represented on the IIASA board, with more than 3 000 researchers associated with the organisation.

IIASA was launched in 1972 in the days of the Cold War as a “science bridge” between the West and the Soviet Union. It served as a “think tank” for various issues that needed to be resolved. Its mission was reconfirmed after the fall of the Berlin Wall in 1989.

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