ECONOMIC REVIVAL
CAROL PATON: Rescue package more longer-term remedy than short-term fix
As President Cyril Ramaphosa’s stimulus and rescue package did not contain any fiscally stimulating measures, it is doubtful it will have much effect on short-term growth. The point of a fiscal stimulus is to put money into the economy fast; preferably money that will get spending and investment going, and better still be the kind of investment that reduces the cost of doing business through improved infrastructure and economic network services. This package puts in no new money and doesn’t alter the composition of spending in the budget, leaving it skewed in favour of consumption, particularly wages, rather than investment. But, as Ramaphosa said: "We are having to deal with what we have", and clearly the pressure was too much – especially from business and the investor community — that SA stick within the fiscal framework and not be seen to yield to economic populism. And so, dealing with what we have, the package is good for business and in several regards — visa regulation, mini...
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.