A South African National Defence Force (SANDF) patrol walks through the Noord Taxi Rank in the Johannesburg CBD. Picture: MARCO LONGARI / AFP
A South African National Defence Force (SANDF) patrol walks through the Noord Taxi Rank in the Johannesburg CBD. Picture: MARCO LONGARI / AFP

In this edition of Business Day Spotlight, we’re looking back at the week in economics as the country moved from level 4 to level 3 of the national lockdown.

Host Mudiwa Gavaza is joined by Miyelani Maluleke, an economist at Absa Corporate and Investment Banking to discuss the issues.

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Maluleke starts by talking about Absa’s economic activity tracker, a tool that their team has developed in response to the lack of standard economic data that market players tend to rely on. With quarterly GDP figures delayed for example, he says they have turned to data from sources like Eskom and Google to glean some insights on how the economy is and has been performing.

Business Day Spotlight host Mudiwa Gavaza. Picture: DOROTHY KGOSI.
Business Day Spotlight host Mudiwa Gavaza. Picture: DOROTHY KGOSI.

Though these measures are still being developed and are not perfect, Maluleke says the indications so far are encouraging. As more businesses open up and people go back to work, there has been an uptick in movement and activity which is a good sign. However, he warns that people need to be cautious when looking at the data because there are still a number of fundamental weaknesses in the economy.   

Before the outbreak of Covid-19, the major concern among investors, businesses and individuals was the low growth environment, Maluleke says, as SA has achieved about 1% growth on average over the past half-decade. Now with downgrades from international ratings agencies and lockdowns, there seems to be more hope for policy reform that will help to stabilise the country in the long term, he says. 

The discussion also touches on the performance of the rand, where the impact of government’s stimulus plan may be felt in future, the development of new economic data reporting standards, how SA is performing relative to other emerging markets and what Maluleke is hopeful about.

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Business Day Spotlight is a MultimediaLIVE production.