BUSINESS DAY SPOTLIGHT
PODCAST | Economic news of the week: Load-shedding may inhibit the economy from moving forward
Mudiwa Gavaza is joined by Jacques Nel, head of macro-economic research for Africa at NKC African Economics
In this edition of Business Day Spotlight, we take a look at the week’s top economics news, focusing on recent data releases.
Our host Mudiwa Gavaza is joined by Jacques Nel, head of macro-economic research for Africa at NKC African Economics, to chat about the issues.
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The discussion starts with Nel talking about the recent energy generation data, which showed that the country produced 1.3% more electricity in July, month on month. Though this does not sound like much, Nel says it is a marked improvement on the 16.5% decline seen in April as demand fell due to the closure of industries at the start of the national lockdown.
Positive as it may be, current bouts of load-shedding betray that positivity, highlighting an energy system still incapable of coping with the demand needed to push the economy forward.
He then moves on to manufacturing data.
Absa’s purchasing managers’ index (PMI), which measures manufacturing sentiment, compiled by the Bureau for Economic Research, jumped to 57.3 in August from 51.2 in July. This marks a 13-year high after further easing of coronavirus restrictions supported domestic demand and exports.
The conversation then shifts to the rest of Africa, where Nel says countries have been affected by and have reacted to the Covid-19 crisis differently. What is similar, though, is that many of these economies are heavily reliant on commodities, such as oil, which have seen turbulence globally in the past few months. For this reason, Nel is excited about the prospects of the East African block of countries, which have recorded strong growth in recent years and have diversified economies.
The discussion also touches on new-vehicle sales data; how Covid-19 can help to push for better economic policy; and an outlook for the local economy.
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• Business Day Spotlight is a MultimediaLIVE production.
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