The Times reports that an International Monetary Fund report on SA, which was released yesterday, flags "escalating labour tensions" as "a key domestic risk". Noting that SA’s economic growth is lower than that of other emerging countries, and is too low to cut unemployment, the IMF suggests "a social bargain" that would pull together trade unions, business and the government. It urges "commitments to wage restraint" by trade unions. Pointing to recent reforms in Mexico and suggesting that SA should do something similar to loosen the hold of trade unions on the labour market, the report said this hold has "produced an insider-outsider system that creates too few jobs and stifles growth". The IMF report maintains that more jobs would be created if economic growth were stronger and the labour market "more flexible". The report also urges the government to move more quickly in implementing its National Development Plan and massive infrastructure spending proposals.
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