- Nedbank’s chief economist believes Jacob Zuma’s final term cost the South African GDP R1 trillion
- Economists said the current technical recession is as a result of state capture, maladministration and policy uncertainty during Zuma’s final term
- The poor financial condition of state-owned enterprises like Eskom and SAA have also been blamed for the economy contracting
Nedbank’s chief economist Dennis Dykes believes former president Jacob Zuma’s final term in office has cost the South African GDP R1 trillion in potential losses. His sentiment was echoed by other economists who blame the current economic woes on state capture maladministration and policy uncertainty.
Economists across the board believe the current technical recession and the poor state of the economy during the first two quarters of 2018 can be directly linked to Zuma’s final term in office.
Dawie Roodt said Zuma’s administration had overseen mass corruption, the erosion of good management at state-owned enterprises (SOEs) and left the government with a massively bloated and overpaid civil service.
Briefly.co.za gathered that Dykes said the poorly run SOEs had led to increases in electricity and energy prices which in turn put pressure on the local currency which led to an increase in petrol prices. This, in turn, had the potential to impact the basic cost of living.
Roodt told Citizen.co.za that the current recession was a direct cause of the previous government’s poor economic policies and could not be blamed on external factors.
Thesouthafrican.com reported that plans by President Cyril Ramaphosa to cut the massively bloated civil service in order to reduce the government’s huge salary bill have been met with fierce opposition.
Dykes said the fact that the agriculture sector took such a massive hit in the second quarter served as proof that the South African economy was in bad shape and lacked direction.
On Wednesday, Finance Minister Nhlanhla Nene called on South Africans to remain calm. He said the government had a plan which was set to be introduced in October which he felt confident would restart the economy.
Nene is due to deliver the medium-term budget speech in October and said he would be introducing a raft of policy changes which would bolster the economy.
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