1995 - National Treasury

m
-1.6-
government consumption expenditure is expected
to be contained - no change in real consumption
expenditure by the general government has been
built into the official projections.
Real gross domestic fixed investment in 1995 is
likely to repeat its strong showing of 1994.
Capacity creation in private manufacturing should
lead the way, but significant rises in real capital
spending by public corporations could also make
a noteworthy contribution. It is also foreseen that
the long overdue reversal of the downward
tendency in real fixed investment by the public
authorities will gain momentum in 1995. The
replenishment of industrial and commercial
inventories is expected to continue during 1995.
Were it not for the expected decline in agricultural
output, the growth in real GDP in 1995 could have
been as high as 3 per cent. The decline in agricultural
real value added could, however, possibly
constrain aggregate output growth to 2 1 /2 per cent
in 1995. Over fiscal 1995/96 it is anticipated to be
somewhat higher.
The expected strong growth in gross domestic
fixed investment is likely to support a high level of
imported capital equipment. The current account
of the balance of payments should consequently
remain in deficit throughout 1995. Capital inflows
from the rest of the world are expected to be more
than sufficient to finance the anticipated deficit,
and could lead to a further increase in the level of
the gold and foreign exchange reserves.
The underlying counter-inflationary policies, which
have been applied over the past number of years,
are expected to be sustained in 1995. Some
short-term upward adjustments in the general
price level will nevertheless probably keep the
average inflation rate in consumer prices in 1995
more or less at the average rate recorded in 1994.
The upswing in the economy will require careful
nurturing, sound and consistent economic policies
and an investor-friendly political environment if it
is to be transformed into a sustained growth
phase. The Government recognises that if the
challenges of reconstruction, development and
economic growth are to be met, it is important that
the economic recovery should be responsibly
strengthened.
SOME KEY STATISTICS
Calendar
year
Real GDP
R million
Percentage
change
Real GDP
per capita
R
Percentage
change
Consumer
price index
1990 = 100
Percentage
change
Balance of
payments:
current
account
R million
1984 257 292 5,1 7 987 2,5 42,2 11,5 -2 517
1985 254 175 -1,2 7 700 -3,6 49,1 16,3 5 208
1986 254 221 0,0 7 517 -2,4 58,2 18,6 6 328
1987 259 561 2,1 7 495 -0,3 67,6 16,1 6 708
1988 270 463 4,2 7 631 1,8 76,2 12,8 3 383
1989 276 940 2,4 7 633 0,0 87,4 14,7 3 467
1990 276 060 -0,3 7 434 -2,6 100,0 14,4 5 324
1991 273 249 -1,0 7 192 -3,3 115,3 15,3 6 187
1992* 267 257 -2,2 6 879 -4,4 131,3 13,9 3 940
1993* 270 181 1,1 6 803 -1,1 144,1 9,7 5 829
1994* 276 464 2,3 6 813 0,1 157,0 9,0 -2 089
Average:
1984-1994 0,7 -1,6 13,8
Source: South African Reserve Bank
* Preliminary