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Does Govt have a plan to fix our lockdown-smashed, drowning-in-debt country?
National Treasury expects the South African economy to shrink by 7.2% this year, much in line with the South African Reserve Bank’s forecast of a 7.3% contraction.
On Sunday, however, Finance Minister Tito Mboweni warned that those forecasts are likely to be too optimistic.
Mboweni says that the country’s public finances were “unsustainable” even before the pandemic.
The country’s GDP fell by 51% in the second quarter of 2020, the economy’s worst-ever performance by far.
The apocalyptic plunge was the fourth quarterly contraction in a row.
South Africa’s wildly productive farms kept the nation afloat and fed, with agriculture (up 15%) the only sector recording any growth.
Treasury expects a R300 billion tax revenue shortfall.
The Money Show’s Bruce Whitfield interviewed Duma Gqubule, founder at the Centre for Economic Development and Transformation.
Does the South African government have an economic recovery plan?
We’ve had five consecutive years of contracting GDP per capita…
Duma Gqubule, founder - Centre for Economic Development and Transformation
… the lockdown was too severe and too long…
Duma Gqubule, founder - Centre for Economic Development and Transformation
We could by the end of 2020 see another two million people lose their jobs – pushing the number of unemployed people to 12.4 million people… It’s a humanitarian crisis! … It [job losses] has not ended… We’re going to see a bloodbath… It’s incredible – a third of middle-class households are going to move to a precarious existence…
Duma Gqubule, founder - Centre for Economic Development and Transformation
The government will have no option but to extend some of these benefits… For them to withdraw these grants… I don’t think it’s practical…
Duma Gqubule, founder - Centre for Economic Development and Transformation
Listen to the interview in the audio below.
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