Governor of the South African Reserve Bank, Tito Mboweni, addressed attendees to Microsoft`s SITO Summit, held at Fancourt in George from 17 to 19 May 2006. The Senior Information Technology Officer (SITO) Summit brings together the most senior-ranking functional decision-makers for overall IT strategy and implementation in an innovative and interactive way.
Speaking at the SITO Summit, Mboweni outlined the current status of the South African economy, global economics and their impact on South Africa, the dangers facing economies internationally and factors shaping the South African economy, while delivering warnings concerning possible economic threats in the future.
"The outlook remains favourable for economic growth in South Africa," says Mboweni. "However, while on this pathway to growth, it is important that we step back and look at the state of the local economy and the factors that impact upon it."
He insists that the global economic situation looks good, but that there are still risks facing the global economy; these dangers include the impact of oil prices, geo-political uncertainty, (particularly in the Middle East) and global imbalances.
He says, however, that there are reasons to remain positive about the future of global economics, highlighting the fact the high oil prices have not filtered through to other prices to the extent that might have been previously anticipated and this has reduced its impact on inflation. He also mentions the role of goods and services produced in China and India that are bringing down prices.
He enthuses that the exchange rate is resilient and the South African rand is considered to be one of the top 13 currencies in the international banking arena, while conditions in the manufacturing sector remain robust. Higher than ever vehicle sales are also indicative of favourable circumstances and investment in South Africa continues to improve at a favourable rate.
"There are many risks to the local economy," says Mboweni. "But despite these, South Africa seems to be well set on a pathway to growth. Inflation is fairly subdued and long-term rates are average."
Shifting away from economics as such and focusing on the ICT sector, Mboweni says: "Technology progresses rapidly, perhaps too rapidly, and this means that much money is constantly spent on upgrading technology and requiring new infrastructure. The budget implications here are a problem. Furthermore, although technology has improved so much, we still use only a small amount of its full potential. The ICT sector, therefore, has a responsibility to advocate the better use of technology to its full potential, so justifying the huge budgetary demands made for technology infrastructure."
In conclusion, Mboweni commended the SITO Summit, saying: "Conferences such as these are important. They bring together different experiences to see how we can further improve the South African economy in the spirit of the South African government`s Accelerated Shared Growth Initiative (ASGISA)."
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