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SA will likely experience a slight pick-up in economic activity this year, but its economic problems are too deep-seated and its political constraints too binding to allow for meaningful economic reform and a return to rapid growth any time soon. In all likelihood, the country will muddle through in the mediocre fashion to which it has become accustomed. It won’t tumble over the fiscal cliff in 2019, but neither is it likely to grow by more than 1.5% as long as confidence and investment continue to flounder and consumption is constrained by a lack of jobs. And that is a problem, because faster economic growth would lessen the debt burden, attract investment, reduce funding risks and boost confidence. An extended period of slow growth, on the other hand, means SA’s fiscal and social problems will continue to mount and downgrade pressures will re-emerge. The challenge is to break out of the low-growth trap of the past decade, but this is going to prove extremely difficult given that S...

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