sarb thumb medium60 101Fin24 reports that the Annual Labour Law Conference heard on Wednesday that solutions for SA’s abnormally high unemployment rate would not come from rising commodity prices, a rebound in global growth or fiscal policies.  

SA Reserve Bank (SARD) governor Lesetja Kganyago said that instead product and labour market reforms were needed.  The economy was characterised by high inflation, low growth and unemployment and SA could expect to lose jobs going forward, he said.  “We need change and constitutional reforms for more space for the monetary policy to work,” he stated.  High inflation rates lead to high interest rates.  Low inflation rates reduce interest rates and enhance competitiveness.  It attracts investments and stimulates job creation, which reduces poverty, explained Kganyago.  “We must reconsider the institutions used to negotiate wage prices,” he opined.  Deals that push up inflation and interest rates, reducing growth and resulting in job losses, must be avoided.

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