Economy is ‘taking punches’ – KZN Treasury
Rising unemployment and inflation in store for this year
THE economic climate for KZN this year is not looking sunny.
According to the KZN Treasury’s latest report, the province’s annual gross domestic product (GDP) is expected to drop by 0.9% while the International Monetary Fund (IMF), the SA Reserve Bank (SARB) and multinational bank HSBC all reduced their growth estimates for the country to 0.7%, 2.4% and 1.9%.
Unemployment is also set to rise by 1% to 23% while inflation could surge by 7.5%.
‘The economic outlook for the province is somewhat less optimistic than last year despite the lower oil prices and optimistic US economic growth,’ said the Treasury in its report.
‘The sinking exchange rate and commodity prices, weak Chinese economic outlook and increasing public and household debt burdens will continue to be a significant constraint on the domestic economy.
‘The SA economy is by no means down and out, however, the punches are getting harder and faster.
‘How long the SA economy can withstand these punches is the key question.’
On the brighter side, the Treasury stated lower oil prices is always good news and the end of load shedding is finally in sight.
