EDITORIAL: Transformation of the IMF kind
The IMF is clear: we have to reform product and labour markets so as to open up the economy, create more jobs, and engender more confidence and investment
It’s a relief that the IMF has kept its forecast for SA’s 2017 economic growth rate unchanged at 0.8%, rising to 1.6% in 2018. But it is no comfort that its economists, who just a few months ago had one of the gloomiest outlooks on SA’s economy, were proved correct on their 2016 forecast of 0.3% and now look realistic, even optimistic, on 2017 and 2018. An IMF spokesman said the cabinet reshuffle and subsequent downgrades occurred after the publication cutoff for the World Economic Outlook, which contained the latest forecasts. "Even so, the growth forecast embedded an environment of low investor and consumer confidence, and the risk premium on SA’s foreign currency debt had already been on the high side for several months," said the IMF, which, in other words, was fairly pessimistic even before SA’s renewed efforts over the past three weeks to shoot itself in both feet, economically speaking. Already, some economists have revised down their growth expectations to even lower levels ...
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