LETTER: Our negative economic trends can be reversed
Energy security need to be assured, logistical obstacles resolved and policy uncertainty reduced
06 March 2024 - 14:48
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Thuletho Zwane's article refers (“SA avoids a recession but outlook is bleak”, March 5).
The bad news is that, on the basis of economic growth of only 0.6% for 2023 as a whole, the economy is on present trends likely to see just 1% growth this year. This is more or less in line with most recent GDP forecasts, but still too low to meet SA’s socioeconomic challenges.
A red flag continues to be the further 0.2% decrease in gross fixed capital formation in the fourth quarter. This confirms the negative trend in private fixed investment in 2023, as indicated by the recent Nedbank Capital Projects Listing survey.
Higher fixed investment levels are needed to drive job-rich growth in the period ahead, which underscores the importance of investor confidence.
However, these negative trends are reversible, and investor sentiment can be strengthened if energy security can be assured, logistical obstacles resolved and policy uncertainty reduced.
The faster promised economic reforms can be implemented, the better the growth prospects will be for SA’s economy.
Prof Raymond Parsons
NWU Business School
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
LETTER: Our negative economic trends can be reversed
Energy security need to be assured, logistical obstacles resolved and policy uncertainty reduced
Thuletho Zwane's article refers (“SA avoids a recession but outlook is bleak”, March 5).
The bad news is that, on the basis of economic growth of only 0.6% for 2023 as a whole, the economy is on present trends likely to see just 1% growth this year. This is more or less in line with most recent GDP forecasts, but still too low to meet SA’s socioeconomic challenges.
A red flag continues to be the further 0.2% decrease in gross fixed capital formation in the fourth quarter. This confirms the negative trend in private fixed investment in 2023, as indicated by the recent Nedbank Capital Projects Listing survey.
Higher fixed investment levels are needed to drive job-rich growth in the period ahead, which underscores the importance of investor confidence.
However, these negative trends are reversible, and investor sentiment can be strengthened if energy security can be assured, logistical obstacles resolved and policy uncertainty reduced.
The faster promised economic reforms can be implemented, the better the growth prospects will be for SA’s economy.
Prof Raymond Parsons
NWU Business School
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
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