South African economy to grow 3.4%

JOHANNESBURG - South Africa's economy is still expected to grow at a rate of 3.4 percent this year despite the global financial turmoil, Business Unity South Africa (BUSA) said on Thursday.

According to South African Press Association (SAPA), BUSA believed that any immediate revision of this forecast would be premature.

BUSA represents South African business on macro-economic and high-level issues that affect it at the national and international levels.

BUSA said there are some positive areas in the global outlook, such as high commodity prices for gold, platinum and coal.

BUSA suggested South Africa should focus on factors within its control.

"This means expediting infrastructure spending and related projects to support growth and employment so as to offset any adverse consequences that may arise from the global outlook."

Interest rates, with the repo rate now at 5.5 percent, might have to remain low for longer to support the economy, possibly well into 2012.

SAPA reported that BUSA's economic policy committee would meet on August 26 to monitor the outlook in light of recent trends and reassess its economic forecasts.