South Africa Predicted To Suffer Further Due To Already Weak Economy
South Africa suffered economically over the past years and some analysts predicted that the country may slip further into an economic crisis as industries remain fragile and incumbent President Cyril Ramaphosa struggles with his leadership.
According to Bloomberg, data from Eunomix Business & Economics Ltd. suggested that South Africa's performance on major aspects of the economy over the past decade significantly declined compared to other countries that aren't experiencing wars.
Economists noted that one of the possible reasons why South Africa has been underperforming is the country's continuous reception of beatings from missteps made by the previous administration.
The advisory firm further forecasted that South Africa's turmoil could potentially reduce Ramaphosa's time as the country's leader. He is preparing for his first national election on May 8 and his struggles with fixing an already weak economy could play a role in his campaign.
"There is the strongest likelihood of him being a one-term president. He is starting with a very weak economy, the weakest of any president since Mandela. He is also starting with a fairly weak hand from a political standpoint," head of Eunomix, Claude Baissac, explained.
The Eunomix report also cited South Africa's apartheid history as one of the possible reasons for the country's apparent decline. There is an imbalance in the society that keeps political leaders from making decisions that could otherwise boost the economy but are being rejected by elites who have political influence.
In the ranks for the world's most miserable economies, South Africa is in third place. While Argentina and Venezuela have been ranked second and first respectively, South Africa's inclusion in the top five list is an issue of worry, analysts said.
Retail sales have also indicated that the African country's economy is sluggish ahead of the May election. While the 1.2 increase in retail sales is higher than expectations of a 0.6 hike, economists said the numbers are not enough to help pull up the economy for the year's growth rate.
Despite increased worries over the South African economy, experts at Capital Economics noted that economic conditions could rebound later in 2019. Still, there are risks to the expected 1.5 growth forecast for this year, they reiterated.
Meanwhile, political economist Moeletsi Mbeki urged the South African government to take the courageous step of shifting away from the "nationalist paradigm" that has been reigning over the country for many years.
Mbeki said the shift was necessary to spur economic growth and kickoff necessary reforms. He noted that two nationalist regimes have already failed to bring about the change needed to keep the country afloat.