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SA is full of contradictions and things that don’t make sense. It will be the job of the new administration — in the process of being appointed as this column goes to press — to pick at these knots. Firstly, what are the binding constraints on growth and how are these nested inside each other? The year 2018 showed that growth was harder to kick-start than expected. Removing “negatives” was not sufficient and whilst sentiment improved, animal spirits did not return. (Economist John Maynard Keynes coined the term “animal spirits” to refer to emotional mindsets.) The first quarter of 2019 was the same, masked by load-shedding, underlying growth would have actually been exceptionally weak anyway even if there hadn’t been load-shedding. A further improvement in sentiment after the elections will not cause growth and the resumption of animal spirits without someone opening the taps. Given the constraints on the fiscus and monetary policy, that is going to have to be banks. However, bank...

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