Dawie Roodt, chief economist at the Efficient Group, believes that there is little reason to be optimistic now that South Africa is no longer in a technical recession.
Statistics South Africa revealed on Tuesday (4 November) that the country’s economy expanded by 2.2% in the third quarter – effectively ending the country’s negative growth trajectory.
On Wednesday, meanwhile, motorists were also granted some relief with one of the most substantial petrol price decreases in South African history taking effect.
Despite these positives, Roodt said that there were still a number of threats to be wary of heading into 2019.
“Probably the biggest threat to the economy is the fact that the ANC seems hell-bent in going ahead with its land-grab despite warnings by foreign investors that tampering with property rights was a very bad idea and would have a massively negative impact on the country’s economy,” he said.
“What this country needs more than anything else is foreign direct investment that can create jobs and alleviate the abject poverty that millions of our countrymen are finding themselves in.
Roodt said it was possible that the slight improvement in growth might stave off further downgrades from the ratings agencies which would be a positive step.
Dawie Roodt, chief economist at the Efficient Group, believes that there is little reason to be optimistic now that South Africa is no longer in a technical recession.
Statistics South Africa revealed on Tuesday (4 November) that the country’s economy expanded by 2.2% in the third quarter – effectively ending the country’s negative growth trajectory.
On Wednesday, meanwhile, motorists were also granted some relief with one of the most substantial petrol price decreases in South African history taking effect.
Despite these positives, Roodt said that there were still a number of threats to be wary of heading into 2019.
“Probably the biggest threat to the economy is the fact that the ANC seems hell-bent in going ahead with its land-grab despite warnings by foreign investors that tampering with property rights was a very bad idea and would have a massively negative impact on the country’s economy,” he said.
“What this country needs more than anything else is foreign direct investment that can create jobs and alleviate the abject poverty that millions of our countrymen are finding themselves in.
Roodt said it was possible that the slight improvement in growth might stave off further downgrades from the ratings agencies which would be a positive step.
Roets said that, traditionally, the day of reckoning started early in the new year when holidaymakers returned to the harsh reality of school fees and the continuously increasing cost of living driving up monthly expenses.
“February, March and April are usually the three months when we see the greatest number of deeply indebted consumers knocking on our doors to have themselves placed under debt review because they were no longer able to manage their debt on their own.”
He said these were the months that debt collectors started knocking on the doors of over-indebted consumers who were no longer able to service their debt load and who were at risk of losing their property to loan sharks and debt collectors.
