South Africa has reiterated its support of a resolution by the Group of 20 (G20) Finance Ministers and central bank governors to promote the scaling-up of internal policies to deal with the “crippling” global unemployment crisis.
Speaking at the ongoing 103rd session of the International Labour Conference in Geneva, Switzerland, Department of Labour international Relations chief director Sipho Ndebele said that, consistent with the G20 objective of strong, sustainable and balanced growth, there was general acceptance by G20 members that the challenge of employment required a significant scaling-up of actions in support of employment promotion policies.
“Generally, there is common acknowledgement of the need for direct intervention in the economy through various policies. Such interventions are geared to contribute to lifting the gross domestic product (GDP) by 2% above the trajectory by closing the cyclical gap and enhancing growth potential,” he asserted.
Ndebele added that tripartite processes to promote coherence and complementarity between pro-employment macroeconomic frameworks and labour market interventions were “being engaged”.
“This is properly reflected in the general support by the Employment Task Force and social partners of the decision by G20 Finance Ministers and central bank governors to collectively commit to lifting economic growth above the baseline forecasts over the next five years through a range of measures, including employment and participation,” he commented.
It was within this approach, Ndebele stressed, that the G20 Employment Task Team had reached consensus on comprehensive growth strategies for each member State.
“Moreover, it was highly innovative for the Framework Working Group to agree on a peer review process, even during the construction stage of these comprehensive strategies. This has allowed early insight into the potential weaknesses of these strategies,” he noted.
According to Ndebele, the strategies outlined measures aimed at reinforcing a tenuous global economic recovery through short-, medium- and long-term objectives that tackled existing key economic issues inhibiting the progression of economic growth.
This would include addressing the output gap – requiring growth-friendly fiscal consolidation and the promotion of competitiveness – structural reforms to foster employment, enhanced global trade and investment, as well as education and skills development.
Moreover, the strategies had shown that consumption would remain the primary source of domestic demand, while investment would remain crucial in maintaining, or initiating, stable growth.
“Post-crisis growth has remained weak and sluggish in most G20 countries, bar a few, and the weak global recovery has been compounded by international spill-over effects from the financial market volatility since 2011.
“GDP growth, driven by domestic demand and consumption, as a way to increase living standards has emerged as a popular strategy employed by the G20 members,” he remarked.