LEAD: South African president plans "massive" infrastructure growth

Feb 9, 2012, 19:03 GMT

Johannesburg - South African President Jacob Zuma on Thursday pledged a massive push to develop the country's infrastructure, expand its mining sector and help create desperately needed jobs.

Zuma said the government would invest in railways, roads and water connections in various regions across the country.

The mining sector would also expand, to extract more coal, iron ore, platinum, chrome and other natural resources. Charges at ports would also be reduced for manufacturers.

The 'massive infrastructure development drive' would include allocating 300 billion rand (39.4 billion dollars) for projects over the next seven years to boost exports of natural resources, Zuma told both houses of parliament during the annual State of the Nation address.

'We remain committed to the creation of a favourable and globally competitive mining sector, and to promote the industry to attract investment and achieve both industrial growth and much-needed transformation,' he said, but stopped short of outright rejecting the prospect of nationalization.

The president - who said the country faced a 'triple challenge of poverty, inequality and unemployment' - urged the public and private sectors to work together to create jobs.

While the government promised last year to create 5 million jobs by 2020, the country's growth rate has been far below the 6 per cent that would be needed to reach the ambitious target.

However, reducing economic inequality and poverty 'is beginning to look possible,' Zuma said, calling for better cooperation between the public and private sectors.

South Africa was hardest hit on the continent by the global economic crisis.

'The massive investment in infrastructure must leave more than just power stations, rail-lines, dams and roads. It must industrialize the country, generate skills and boost much needed job creation,' said Zuma.

Unemployment declined in the fourth quarter to 23.9 per cent, and most recent jobs created were in the formal sector. But analysts have questioned whether the employment growth was sustainable for Africa's largest economy.

Addressing local concerns, Zuma pledged the state would improve schools, keep more learners in school and better the country's hospitals. He did not outline specific plans.

He also said the government would offer more housing opportunities for the poor and work to ensure stable electricity at affordable prices.

Zuma admitted that efforts to reverse colonial and apartheid era land laws, which gave most land ownership to whites and discriminated against blacks, were not working. He said new plans were being developed.