SA’s economic fundamentals are always up for debate
‘Economic fundamentals’ are not, as presented by some of our country’s commentariat, uncontroversial laws of nature
Stats SA recently announced that the official unemployment rate had increased by 0.3 of a percentage point to 27.5%. The expanded unemployment rate also rose to 37.3% from 37.2% in the previous quarter. While these developments are disturbing, in many ways they are to be expected from a highly concentrated, capital- and resource-based economy that has struggled to bring about fundamental socioeconomic change for the majority of South Africans. It is within this context that we must consider recent comments by SA Reserve Bank governor Lesetja Kganyago and others who have decried so-called “populist” solutions to resolve the current crisis. In this view, we should reject “emotive” calls for change and recommit to the well-worn path of inflation targeting, “fiscal discipline” and a free-market economy. A similar perspective was echoed by Khaya Sithole who argued that the call for the Reserve Bank to abandon inflation targeting, “betrays a lack of appreciation of the fundamentals of eco...
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