Tag: economic growth

South Africa ranks 99th out of 165 countries and territories included in the Economic Freedom of the World - 2022 Annual Report, we have released in conjunction with Canada’s Fraser Institute. It can be noted that in 2000, South Africa ranked 47th on the list of countries analysed.

Central banks around the world are hiking interest rates to battle rising inflation. Recessions are now expected in the US, UK and Europe in the next year. Interest rates around the world are rising at an alarming pace, as central banks admit that inflation is becoming more ingrained, rather than just a series of transient shocks.

South Africa’s franchise sector has shown tremendous resilience, first withstanding the heaviest effects from economic lens of the COVID-19 pandemic, secondly, looking at how global economies, suffered from the knock-on effect of the Russian war in the Ukraine.

A 26% increase in headline earnings per share and a robust balance sheet enabled an 81% increase in the interim dividend per share. The South African economy held up relatively well as global economic conditions deteriorated significantly in the first half of 2022.

South Africa’s economy is in a mess, to say the very least, and all this is solely and exclusively the fault of policymakers. Everything has gone horribly wrong! Yet it is not all beyond redemption.

The South African Reserve Bank (SARB), historically finding its expression in the Currency and Banking Act of 1920, is today premised on section 224(1) of the Constitution. Has the Reserve Bank been acting constitutionally since its legal foundation changed? Has it been protecting the value of the Rand in the interest of balanced and sustainable economic growth as required? How would the Reserve Bank meet its constitutional objective?

June was a brutal month for global equities, capping the worst first half of a year since the launch of the MSCI All Country World Index in 1987. For indices with longer track records, the story is worse. In the case of the US S&P500, the first half performance has not been this bad since 1962.

In March this year, in a much-publicised interview (Neal Froneman gets frank about the lows, and highs, of doing business in South Africa), Sibanye-Stillwater CEO Neal Froneman heavily criticised the state of South Africa’s economy and government, citing a lack of leadership.

Industry 4.0 can exponentially grow developing economies and combat resource-related challenges. The manufacturing sector is South Africa’s fourth largest sector and a key driver of economic growth. However, industrialisation challenges in recent decades and the relatively slow adoption of new technologies have hampered the true potential of this industry.

Equity markets have been under considerable selling pressure in 2022, as investors anticipate that stubbornly high inflation will cause central banks to raise short-term interest rates multiple times this year. At the same time, expectations for global economic growth have been revised downwards, following further disruptions to global supply chains on the back of Russia’s invasion of Ukraine and China’s strict COVID-19 lockdown measures.