Rising metals prices will play 'significant role' in SA's economic recovery - Ramaphosa

JOHANNESBURG - President Cyril Ramaphosa says the rising metal prices will play a significant role in driving the recovery of the economy from the current Covid-19 downturn, which has seen unemployment rise to record levels, as the country battles a new surge in infections.

Commodity prices have been on an upward trend, with local producers of platinum group metals, coal and iron ore prices reporting significantly improved earnings that have helped offset the impact of Covid-19 on operations.

"High commodity prices and rising global demand is good for our economy, particularly  the mining sector," said Ramaphosa in his weekly letter to the nation on Monday, adding that the prices surge will "play a significant role" in accelerating economic recovery.

The pandemic has severely impacted the country's weak economic growth, with domestic expectations by the SA Reserve Bank, Treasury and local economists seeing growth of anywhere between three percent and five percent

The World Bank in June revised the South African economy's growth outlook from 3.3 percent to 3.5 percent while the official unemployment rate has increased to 32.5 percent.

Local mining executives have over the past few years voiced concern that the industry had lagged other mining zones on the continent and the world in terms of investment, due to unfriendly policy framework and the country's unstable energy supply, and Ramaphosa stated that government faced a host of demands for infrastructure support.