Charles Molele
President Cyril Ramaphosa says the news on Tuesday that South Africa’s economy has slipped into a recession does not come as a shock or a surprise to him.
“The poor growth figures could not have come as a shock or surprise to us. The signs were there. The drivers have been there for us to see such as load shedding and the impact it has had on production and trade in general,” said Ramaphosa.
Ramaphosa was addressing journalists at a meeting with the South African National Editor’s Forum in Cape Town on Tuesday shortly after the news of the recession broke.
According to Gross Domestic Product figures released by Stats SA, the economy slipped into its third recession since 1994, shrinking by 1.4% in the fourth quarter of 2019.
This follows a revised 0.8% contraction in the third quarter.
Agriculture declined 7.6%, transport 7.2%, construction 5.9%, electricity 4% and retail 3.8%.
“Finance, mining and personal services managed to keep their heads above water, but this was not enough to prevent the economy from sliding into its third recession since 1994,” Stats SA said in a statement.
The recession represents a huge blow to Ramaphosa’s efforts to revive the economy and stave off a downgrade of the country’s sovereign debt to below investment grade by rating agency Moody’s.
Floyd Shivambu, Economic Freedom Fighters Deputy President, slammed Ramaphosa and Finance Minister Tito Mboweni, saying the recession was a result of their ‘reckless leadership’.
“The South African economy is shrinking and this is due to poor and reckless leadership of Cyril Ramaphosa and Tito Mboweni. To make things worse, Tito Mboweni – who overestimates his brilliance – is cutting on government expenditure, which will only serve to stifle economic expansion,” said Shivambu.
Democratic Alliance’s interim leader John Steenhuisen said: “Terrible news, but this is what happens when timidity and poor policy choices reign and the deep reforms are not made.”
(Compiled by Charles Molele)
