ANC's mismanagement leads South Africa's economy to a dismal 1.3% decline
7 March 2023
Since the start of this year we have not seen a single day without loadshedding. Day after day, our communities are plunged into darkness, as the ANC government fails to deliver on its promise of reliable electricity supply and effective governance. The impact of the high-level rolling blackouts on our economy cannot be overstated - businesses are forced to shut down, jobs are lost, and our most vulnerable citizens are left to suffer.
Today, it was announced that South Africa recorded negative growth of -1.3% for the 4th quarter of 2022. Growth expectations for 2023 remain grim at best.
Rolling blackouts and the ANC’s stranglehold on every sector of the economy evidently make it increasingly difficult for any business sector to increase its activity as both large and small businesses in all sectors across the country are experiencing the effects of load-shedding and cost of doing business on their performance.
Despite a marginal rebound in economic activity, the 2% growth recorded in 2022 is sub-optimal and highlights the challenges that businesses are facing due to rolling blackouts and the high cost of doing business. The current state of South Africa's economy is a reflection of the detrimental effects of the ANC’s insistent iron grip on every aspect of the country's economic activity, which has made it increasingly difficult for both small and large businesses across all sectors to thrive.
South Africans in the meantime are getting poorer in the midst of a cost-of-living crisis. Households are battling to put enough food on their tables. Unemployment remains sky-high as business bears the brunt of increasing electricity blackouts and rapidly increasing debt is crowding out more and more basic service delivery. Additionally, the recent FATF greylisting has further exacerbated the situation, with financial institutions now bearing the brunt of compliance costs, ultimately being passed on to the already struggling consumers.
In February, we presented the DA’s Alternative Budget for 2023 which provides a fiscal policy platform and quickly implementable solutions that would redirect South Africa's economic trajectory towards virtuous growth.
To establish resilience and stimulate economic growth our Alternative Budget proposes innovative solutions to attract foreign capital, encourage domestic savings, revitalise state-owned entities, fix our crumbling infrastructure, enhance labour market participation, and facilitate the expansion of both the small and large business sectors.
The ANC's talk-shops and empty promises have failed to deliver the economic growth our nation desperately needs. Instead, the party has effectively normalised sub-optimal growth and has shown itself far too interested in factional infighting and extracting wealth from taxpayers to bail out moribund SOEs to worry about running the economy.
However, South Africans have a unique opportunity in 2024 to vote DA and change the country’s economic trajectory for the better. In the meantime, we will increase pressure on Government to implement workable economic policies to get our economy on the path to growth and to urgently address the cost-of-living crisis.
Issued by Dion George, DA Shadow Minister of Finance, 7 March 2023
