Hi all…
Mentioned the SA economy in the UHURU thread and was asked to state some of my facts so here goes:
28% unemployment (Many think it’s more but this is official)
4 Million Ilegal immigrants
10.8% Inflation and rising
Rising taxes which won’t curb inflation (Inflation is currently globally driven, not by spending), JUST ADD TO MONEYLESSNESS ;D
Rampant Crime
Current Account Deficit expanding and not looking good.
Eskom Curbing Growth
Brain drain
Now once we’ve accepted these as facts, I’ll put them into perspective. For an emerging economy to remain ‘afloat’ it needs to keep growing at a faster pace than developed countries. With Eskoms problems, the economy has been dealt a big blow which could take up to 20 years to sort out. Jobs are being cut, Foreign Direct Investment is being lost and companies are struggling. To add to the plight of SA Companies, Interest rates are being raised to try and curb expenditure but in actual fact, this is not the cause of inflation, It is the growing demand from the East. Eskom, Crime, Current Account Deficit and the support our government is ‘giving’ bob to the north is painting a bad picture for foreign investors, Hence the drop in FDI. We are meant to be in a rapid growth phase as a result of 2010 but our target growth has been lowered to 3.5% this year!!! That is less than some developed countries…
So lets put it like this, We have a struggling economy, an extra 4 million people to take care of, most people live in poverty while cost of living has almost doubled and with oil ear marked to hit $200 a barrel it should triple. To add to the already struggling populations woe’s, we raise interest rates to curb imaginary spending, further reducing the amount of money people have. With the brain drain causing incompetent people into important jobs (Look at eskom and BEE). Now, how will 50% OF OUR POPULATION FEED THEMSELVES with food 200% higher, wages (which half of them don’t earn) 20% up and the lights out… Well, I’ll tell you… go knock on your neighbours door living in the nice suburbs!
If someone can tell me if they see a way around this, please let me know, CAUSE I SURE DON’T!