Editorial | Upturn in GDP an encouraging sign

Economic news is rarely chipper these days and usually entails some or other indicator pointing to yet more doom and gloom in South Africa.

But Tuesday’s announcement of a nifty 3.1% rise in GDP in the final quarter last year was, indeed, welcome.

Combined with hope in some quarters that President Cyril Ramaphosa represents a change in fortunes for our maligned nation, it seems the honeymoon period – real or imagined – following former president Jacob Zuma’s departure, continues unabated.

Overall, growth for the year was still insipid at a higher 1.3%, but exceeded Treasury’s expectations.

It follows four barren years of falling growth, so not to be sneezed at.

Naturally, talk has turned to Moody’s credit review of South Africa’s debt later this month.

Their announcement is eagerly anticipated, perhaps with no small measure of trepidation, as junk status was a foregone conclusion while Zuma clung to power.

Still, Ramaphosa’s inauguration is no guarantee of a new and favourable outcome.

Expect his cabinet changes to receive careful consideration.

On the plus side, Nhlanhla Nene resuming at Treasury and Pravin Gordhan charged with fixing state companies, convey a positive message.

The rogues retained within cabinet are arguably being set up for the cull and government should have no trouble arguing this case.

The measures taken to boost tax revenue, although unpopular to hard-working folk and the poor alike, should mollify Moody’s, too.

Ending the impasse over the country’s disputed mining charter is another avenue of optimism, with Anglo boss Mark Cutifani yesterday expressing delight following an industry meeting with Mining Minister Gwede Mantashe.

But growth is the big play – it always has been, along with prudent state spending.

Ramaphosa’s embrace of a smaller executive is, again, an affirmative message on the cost side. But the yardstick remains growth. Everything rests on this. And, now, the question of land, which, left in the hands of the EFF, could snip any greenshoots of recovery and consign us to the economic gulags.

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