LESETJA KGANYAGO: The reasons why SA can expect better growth over the medium term
There is scope for further reforms and an impressive amount of low-hanging fruit is available, should we develop an interest in picking it
In 2017we had a Goldilocks global economy. Inflation started picking up in the advanced economies, and in emerging markets it was in line with targets. Growth was stronger, and most economies were accelerating — the world economy felt just right. As you know, at the end of the Goldilocks story a family of bears comes home. Our tale has taken the same direction. The synchronisation of global growth has broken down in 2018,with the US surging ahead while other countries slow down.
Stronger US growth and higher rates have appreciated the dollar. This combination of factors challenges emerging markets. It has interrupted capital flows and prompted currency depreciation. Countries with substantial stocks of foreign currency debt have seen their balance sheets deteriorate. Inflation pressures have generally intensified. Unlike Goldilocks, however, most emerging markets weren’t caught napping when the bears returned. Policy frameworks can handle such challenges. In particular, most e...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.