private nonfarm employment fell 66, 000, compared with increases averaging around 175, 000 per month over the preceding twelve months. the shortfall of roughly 240, 000 jobs from the earlier trend is a crude measure of the direct disruption effects of the hurricane. more important, the apparent absence of significant indirect effects in other areas of the united states is an indication that the underlying gains in employment and income were well maintained outside the gulf region. an important question for policymakers is how inflation and economic activity will respond in coming months. one concern is that the rise in energy prices, as well as the downshift in consumer confidence seen in recent readings, may hold back aggregate demand at least for a time. however, the rebuilding itself should provide some impetus to demand in coming quarters. at the same time, of course, higher prices for energy items, including gasoline, heating oil, and natural gas, will be adding to top - line inflation in the near term. as well, these price increases will put upward pressure on the costs of the producers of other items, thereby posing the risk of some impetus to core inflation. whether these pressures are, in fact, passed through to core inflation will depend on a host of considerations, including the willingness of producers to absorb those cost increases and experience, at least for a time, lower profit margins. needless to say, developments in this area will be the subject of intense scrutiny on my part in coming months. a vital contributor to the rebuilding and recovery effort will be the various actions of the federal government. the magnitude of the devastation called for a significant response from the federal government, and the congress and the president acted quickly to provide emergency spending and tax breaks to aid the areas affected by the hurricanes. whether these emergency fiscal measures will ultimately be financed by increased federal borrowing, or by finding offsetting spending decreases or revenue increases, is still an unsettled issue in the congress. to a certain extent, temporary emergency federal borrowing may be viewed as appropriate, as the costs would ultimately be spread out across all u. s. taxpayers over time. nonetheless, given the current size of the federal deficit, additional federal borrowing raises issues because of the potential negative effects that higher deficits can have on the economy. 2 / 5 although expected outlays and tax breaks for hurricane disaster relief raise concerns about future deficits, budget developments over the past year had turned positive before the hurricanes for the first time in a while. for the 2005 fiscal year that just

t t mboweni : perspectives on the economic and financial environment for exporters keynote address by mr t t mboweni, governor of the south african reserve bank, at the annual symposium of the cape pomological association, stellenbosch, 3 june 2008. * * * ladies and gentleman thank you for your kind invitation to deliver the keynote address at your annual symposium. the deciduous fruit industry is characterised by participation of numerous small and large entrepreneurs, and ranges from farming activities to the processing, packaging and distribution of deciduous fruit. a significant amount of this output is exported, and therefore it is appropriate to be talking about the economic environment facing exporters. it is probably not necessary to tell this particular audience that exporters are likely to be facing a particularly challenging environment going forward. contribution of agriculture to the south african economy the deciduous fruit trust estimates that the western cape has more than 2 000 deciduous fruit farmers, ranging from very small entrepreneurs to well - known large farming businesses. farming activities in the western cape provide nearly 100 000 employment opportunities, and the employees in turn support nearly 400 000 dependants. apart from fruit production, the subsequent processing and distribution of deciduous fruit also contributes directly and indirectly to economic activity in the western cape. the trust has also estimated that every increase of r 1 million in final demand for deciduous fruit creates an equivalent of 115 job opportunities through the production and distribution chain. in terms of the overall scale of economic activity in south africa, the contribution of the agricultural sector is comparatively small. the contribution of agriculture, forestry and fishing to gross domestic product ( gdp ) was about 2, 3 per cent in 2007, down from 2, 8 per cent the previous year, with the agriculture sub - sector contributing about 80 per cent of this figure. however, these figures conceal the importance of agriculture in certain regions of our country. in the western cape the contribution of agriculture, forestry and fishing to the regional gdp is some 40 per cent larger than the national average, as the western cape accounts for nearly one quarter of the contribution of agriculture, forestry and fishing to domestic gdp. fruit exports currently account for about 2 per cent of our total exports. 1 despite its relatively small direct contribution to economic activity in the country, the agriculture sub - sector must be gauged against its broader contribution to economic activity. considering the strong domestic linkages of the agricultural sub - sector with many suppliers and service - related industries in the south african economy, the contribution of this subsector was substantially higher