Load shedding, election will play major role in outcome of economy – experts

Despite increasing evidence that rates of inflation are easing, South Africa’s economic outlook for 2024 still looks bleak, with foreign debt becoming the biggest downfall after corruption and policy uncertainty.

Various experts have alluded that SA was nowhere near a healthy economic trajectory, with the country carrying its shaky economic times from 2023 into 2024.

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According to Prof Raymond Parsons from the North-West University Business School’s Business School Policy Uncertainty Index 4Q 2023 on the negative side, as 2024 arrives the economic outlook will remain a tough and challenging environment.

“The economy will continue to grapple with domestic and global headwinds as it moves into 2024,” the report revealed as it noted that policy uncertainty, load shedding, and the 2024 election would play a major role in the economic outcome.

However, Daniel Silke, a political economy analyst, said although growth was expected to improve to some degree, the lack of policy clarity – which was going to be with SA until perhaps for the better part of the year, or at least until after the election – was holding back the economy.

“The election skews all sorts of things, because in an election year governments want to hand out money, they want to deliver certain benefits to the people, up salary for the bureaucrats, and of course, we are cash strapped.

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“We simply don’t have money, and this is the big trade off that the ANC has to make over the course of the first six months.

“How does it keep its voters relatively happy? How does it keep its big bureaucracy relatively happy with better-than-expected salary increases?

“But at the same time, where does it get the money from? It can’t really tax South Africans anymore because we’re already a very highly taxed nation.”

Eric Naki A rebellion is brewing among ANC structures in the North West as dissatisfied members have threatened to boycott the party’s 2024 election campaign work.

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This after their names were cancelled from the list of parliamentary and provincial legislature candidates submitted to the ANC provincial executive committee (PEC) by the provincial list committee (PLC).

The members from the four ANC regions of Bojanala Platinum, Ngaka Modiri Molema, Dr Kenneth Kaunda and Dr Ruth ANC members threaten to not campaign Segomotso Mompati, want the ANC head office to intervene after names that were democratically selected by branches were replaced with bogus names from outside the process.

On Thursday the members protested outside Mpekwa House, the ANC’s provincial headquarters in Mahikeng, to express their dissatisfaction to the PEC.

Spokesperson for the branches, Kefilwe Adindu, said the members believed the PLC ignored the results of nominees by branches. She said, instead of using the branch generated lists at the recent extended ANC PEC meeting, the meeting made deals among attending structures.

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“We came together to protest because we are not happy with process followed… “All the four regions in North West have issues with the lists that have been submitted because the processes, rules and guidelines have not been followed,” she said.

Adindu claimed four of those nominated on the bogus list did not have matric and many have no post-matric qualifications nor any skills, knowledge or experience relevant to help ANC in the legislature or in government.

“The process was completed without conducting interviews as required by the guidelines.” Adindu said the lists included a person who was never nominated nor attended interviews.

The branches were also surprised to find two nominees that were implicated as suspects by the Zondo commission on state capture.

The ANC nomination guidelines prohibited those implicated by the commission from being nominated as MPs and MPLs. The members said ANC secretary-general Fikile Mbalula was aware of their complaints, and hoped to get an audience at the upcoming extended NEC meeting.

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“Comrades from sub-regions that are not represented on the list are planning to boycott elections work,” said a branch member. Silke said what SA could do was borrow more on global markets.

“And we’ve seen indications that our borrowing will go up. I don’t think our borrowing is in dangerous territory,” he said.

“But if you get into a cycle of borrowing extensively to placate your bureaucracy especially in the time of an election, someone’s going to have to pay back the money at the end of the day.”

Economist Dr Azar Jammine said the government projects government debt to rise to 78% of GDP by 2025-26.

“So we’re running after our own tails, collecting taxes to pay interest,” he said.

“On a debt level that is spiralling all the time. That is the real problem, you can carry on so far and eventually you run out of money to pay the interest.”