Is the worst behind us?
EDITORIAL: Time for firms to spend
Companies generate two-thirds of investment in SA. And they were sitting on a cash pile of R725bn by the first half of 2016
Is the worst behind us? SA’s economy avoided a recession, if barely in the technical sense, during 2016. Fourth quarter GDP contracted by 0.3% — a figure that was lower than forecast, and which confirmed that 2016 was the worst year since the 2009 recession. Output in the mining sector contracted by 11.5%, hacking 0.9 percentage points off overall GDP growth. But while mining output can be predictably volatile, the 3.1% contraction in manufacturing sector growth is more worrying, revealing that the recent weakness of the rand failed to boost the competitiveness of SA’s exports. We don’t need to be reminded, but slow growth is one of the central risks to SA’s credit rating. And while economists say 2017 is already better than last year, growth is still only expected to reach 1.3% according to a treasury forecast. Whether the economy can beat that may depend on the private sector. Companies generate two-thirds of investment in SA. And they were sitting on a cash pile of R725bn by the ...
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.