THERE are a few silver linings to an otherwise dark economic outlook for South Africa.
Efficient Group chief economist Dawie Roodt, the keynote speaker yesterday at a PKF and Efficient budget event at the Hellenic Hall in Port Elizabeth, predicted that South Africa’s economic growth this year would be less than 1%, compared to the Treasury’s prediction of 2%.
Roodt said this year’s budget, presented last week by Finance Minister Nhlanhla Nene, was more of a wish list than a budget, with unrealistic assumptions.
Eskom’s electricity crisis would have a huge impact on the economy, he said, but a silver lining would be if the government decided to sell off or privatise some of the struggling parastatals.
The devaluation of the rand against the US dollar could be good news for the motor industry, which dominates a big part of the Eastern Cape’s economy, because of exports.
The actual opposition in South Africa was not the DA or the EFF, but the financial markets, Roodt said. And these would react strongly to his predicted strikes in both the gold mining industry and civil ser vice this year.
“Civil servants have had an average salary increase of 8% and get 30 to 40% better remuneration than employees in the private sector.
“About 70% of new people being employed in South Africa are civil servants. They are in the top 30% income category of the country. We have a bloated civil service that is smothering the economy.
“The minister knows that the wage bill is a big concern and he budgeted an increase of 6.6% for government employees, but the unions are demanding 15%,” Roodt said.
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