President Cyril Ramaphosa says South Africa's economy has stalled and public finances are under severe pressure.

In his State of the Nation address on Thursday, he blamed persistent power shortages for the faltering economy, and said several state-owned enterprises were in distress.

He said South Africa would establish a sovereign wealth fund and set up a state bank to extend access to financial services.

Several state firms, including South African Airways and the power company Eskom, are in crisis, partly due to mismanagement.