By Though the economy of the Free State experienced some stagnation over the years, evidence shows that the economy grew from R280 billion in 2019 to R340 billion in 2023.
The Free State MEC for Finance, Tourism and Economic Development Mr Ketso Makume, said during his budget speech for DESTEA on Thursday, 1 August 2024, at the Provincial Legislature in Bloemfontein, the provinces GDP is expected to grow at an annual rate of 1.57 percent by 2028.
Makume highlighted the economic challenges faced by the province, which included a rise in the unemployment rate by 3.6 percent from 34.4 percent in the first quarter of 2023, compared to 38.0 in the first quarter of 2024.
“The youth unemployment rate (15 to 24 years) is the highest at about seventy-one point two percent (71.2%), followed by forty-eight point three percent (48.3%) among the 25 to 34 years age group,” said MEC Makume.
Though faced with many challenges, the economy of the province grew steadily contributing between 4.9 and 5 percent to the national GDP in past five years.
According to MEC Ketso Makume, to grow the economy, the province needs to attract more foreign and domestic investment into the Free State.
“The increasing evidence of easing inflation, and in turn possible lower interest rates, may be a tonic that the economy needs, which may see robust economic activity and demand,” he said.
Following the marching orders by President Cyril Ramaphosa, MEC Makume has dedicated himself and his department into building an inclusive economy that will create jobs and reduce poverty.
“The most pressing task in 2024 and beyond is to set the economy on a higher path of shared growth, to create more jobs and provide opportunities for millions of South Africans. This requires levels of investment far beyond what has been achieved in recent years. We need to mobilise domestic and international investment while we work with greater effort to unleash the economic potential of all our people, especially youth and women, by ensuring they have skills, assets and opportunities,” said MEC Makume.
Makume made mention of the economic potential of the Free State and exploiting the industries in the province. He dispelled the notion that the mining sector is a sunset industry in the province; instead, he said the sector, especial in gold mining still has some opportunities of extracting gold for years to come.
He said other mining opportunities in the Free State include low-grade coal, diamond, uranium, and salt. There also has been some natural gas deposits discovered in a large area around Virginia and other parts of the province, which represents an opportunity for creation of hundreds of jobs in downstream economic activities.
“The province also prides itself of being the bread-basket of the country. Crop production represents about two-thirds of the province’s gross agricultural income. The main crops are maize and wheat. Sunflowers, sunflower seeds, sorghum and soya beans are other major crops. The agriculture sector presents huge potential for growth and is thus a good destination for investments.
Game hunting is also a significant sector, and several large Free State farms have been converted from stock to game farms,” he said.
“The province is also an ideal destination for renewable energy projects; these include solar photovoltaic (PV), hydro, and wind projects. In addition, the grid availability in the province continues to attract investments by independent power producers (IPP) in renewable energy projects in the Free State province,” continued MEC Ketso Makume.
