Top economist in the land, Roelof Botha, said despite the turbulence in the South African market with regards to the political situation, financial misappropriations in government structures, the SASSA debacle and many other political issues, there is still hope that South Africa will not be downgraded to junk status.
Botha was speaking at a Standard Bank Agribusiness Conference in Bloemfontein last Thursday. Nico Groenewald, head of Agribusiness at the Moving Forward Bank, said that the conference was held for all stakeholders in the agricultural sector and was aimed at sensitising and preparing them for volatility in global markets and how to stabilise this in the South African context.
Quoting from a World Economic Forum (WEF) report released in the last quarter of 2016, Botha said: “South Africa maintains its regional leadership in terms of financial markets, competition, infrastructure and education, despite recent challenges from exchange rate volatility, governance concerns and policy uncertainty, as reflected in the institution’s pillar.”
Botha said these are among many of the reasons why South Africans should be hopeful that rating agencies will not downgrade the country to junk status. He, however, warned that there are snakes in the grass to look out for, one of them being the ongoing talks regarding nationalisation, which the economist believed “must be hit in the neck with facts”.
Botha presented a scenario case study on Zimbabwe and what happened following its land expropriation without compensation which hit the Mugabe-led country very hard. To substantiate his statement, Botha quoted statistics of the country’s decline, which included the exodus of more than 3 million of its citizens, the decreasing of the GDP by more than 20%, the increase of public debt by more than 60% in the country as well as other dire consequences.
He warned that South Africa too should look into this and use Zimbabwe as an example following controversial talks on the land appropriation issue. Botha added that while there is uncertainty surrounding United States President Donald Trump, he firmly believed that Trump will “aggressively grow the American economy in the next 18 to 24 months”. –Â Pulane ChoaneÂ
pulane@centralmediagroup.co.za
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There is hope for South Africa, says economist
During the Agribusiness Conference held at Emoya Estate are from left: Nico Groenewald (Standard Bank FS Head of Agribusiness), Dr Roelof Botha (guest speaker), Chantell Illbury (guest speaker), Nadia van der Colff (guest speaker), and Anton Nicolaisen (Standard Bank Provincial Head).
