Trevor Manuel: Stop Spending Money You Don't Have

'S Africans act like Americans'

Finance Minister Trevor Manuel said on Tuesday evening that South Africans were not adequately saving for tomorrow and preferred instead to consume in a US-like manner.

He said households were highly indebted and consuming in a manner that mimicked patterns in the US.

"They live on debt and are highly leveraged. It is not a basis of stability," said Manuel.

"If they are borrowing for consumption then there is something wrong in the equation," he emphasized.

Manuel said inflation targeting was a necessary policy as inflation hit the poor and those relying on a fixed salary the hardest and thus price stability was needed.