AILING ECONOMY
Why SA’s best option is to ask the IMF for help
Poor performance has been all the more troubling considering how favourable the global economic environment has been, writes Desmond Lachman
It was once said of the IMF that countries call upon its services with the same enthusiasm as people visit their oncologist. For which reason one must applaud Finance Minister Malusi Gigaba for recognising now might indeed be the time for SA to call for outside help to stabilise its economy. Whereas all too many of his cabinet colleagues appear to be in denial about the seriousness of the country’s economic difficulties, Gigaba seems to realise how useful the IMF might be in helping the country restore investor confidence and arrest its downward economic spiral. At a time when the rest of the world economy appears to be on the mend, there is no shortage of indications that SA’s is in trouble. The country’s per capita income has been declining for a number of years, the economy has now entered its second recession in eight years and unemployment remains stuck at more than 27%. Meanwhile, the rand continues to flounder in the foreign exchange market and inflation continues to exceed t...
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