economic growth

South Africa and the Ratings Agencies – II Fitch

The most recent decision

Fitch affirmed South Africa's investment grade rating in June 2016. Long-term foreign and local currency Issuer Default Ratings (IDR) have been affirmed at BBB- and BBB respectively. The stable outlook remains unchanged.

Key drivers
 
The BBB- rating is a reflection of low trend gross domestic product (GDP) growth, significant fiscal and external deficits, and high debts levels. These are balanced by strong policy institutions, deep local capital markets and favourable government debt structure. 

South Africa and the Ratings Agencies – 1 Moody’s

South Africa is in the middle of controversies relating to the South African Revenue Service, the Hawks, the Minister of Finance, Pravin Gordhan, the National Treasury, and State-Owned Enterprises (SOEs). There are also serious tensions within the government and the ruling African National Congress. South African government bonds have lost money for investors as bond yields have increased. This could get worse if Gordhan is to be replaced by someone who is less trusted by investors.

Impact of Climate Change Highlighted

According to the Intergovernmental Panel on Climate Change (IPCC), the impacts of climate change will significantly affect food security, water availability, human health and ultimately economic growth in Africa.
 
The report, which is under discussion at the opening of the four day Climate Change Dialogue at Gallagher Estate in Midrand, found that Africa's climate is already changing and the impacts are already being felt.
 

Govt Fails to Provide for Citizens

A report states that the national budget has failed to provide adequately for vulnerable citizens as the economic crisis extends.

According to the Confederation of Zimbabwe Industries, about 700 firms have shut down in the past 12 months, increasing the number of jobless people who are in need of state aid.

A parliamentary report on social welfare says the 2014 national budget has failed to provide adequately for items that are critical for assisting vulnerable citizens.

Ailing Economy Fuels Child Labour - UNICEF

The United Nations Children's Fund (UNICEF) estimates that 13 percent of Zimbabwean children are engaged in child labour, due to the demise of the country's manufacturing sector.

Labour experts and economists state that parents and caregivers are forced to send their children to work in order to boost household incomes, following company closures, downsizings and retrenchments which led to the depletion of the manufacturing sector in that country.

Africa's Unemployment Figures Remain High

The United Nations (UN) has warned that some of the world’s poorest nations such as Angola and Ethiopia have failed to cash in on the booming economic growth to create the jobs needed to push their increasing populations out of poverty.
 
UN Conference on Trade and Development’s (UNCTAD) head, Mukhisa Kituyi, states that economic growth which fails to create decent and sufficient jobs is unsustainable.
 

Zimbabwe Introduces Bond Notes

Zimbabwe will introduce bond notes end of October 2016.

The Reserve Bank of Zimbabwe confirmed this in its mid-term monetary policy statement.

At the same time, the Constitutional Court will hear on Wednesday an application by Joice Mujuru who is contesting the introduction of the notes.

To read the article titled, “Zimbabwe: Will the bond notes survive the test of time,” click here.

​ILO Hails Tanzania's Transformation Drive

The International Labour Organisation (ILO) says the Tanzanian government is on the right track in its plans to bring about transformation in the country.

ILO country director for Tanzania, Burundi, Kenya, Rwanda and Uganda, Mary Kawar, says that the country has enjoyed massive economic growth in the past decade - only that the growth has not been inclusive.

"Although the economy has grown in the past decade, the informal economy, low wages and a large number of young people without the right skills, still persist,” she explains.

Africa Needs Electricity to Achieve Growth

The World Bank has urged Sub-Saharan Africa to prioritise addressing the power sector if it is to alleviate domestic impediments to growth.

In a 2016 report entitled Global Economic Prospects: Spillovers amid Weak Growth’, the bank says structural reforms are needed to alleviate domestic impediments to growth and to accelerate economic diversification.

“Creating the conditions for a more competitive manufacturing sector would require, in particular, a major improvement in providing electricity,” it says.

The Road Less Travelled - Swift Action Needed to Prevent SA’s Slide Towards ‘Rocky Road’ Economy

Government and business have their work cut out to prevent South Africa from sliding towards a ‘rocky road’ scenario. This is the worst of four ‘future’ economic outcomes for the country, as described by Dr. Frans Cronjé, chief executive officer of the South African Institute of Race Relations (SAIRR), at the second annual i3 Summit hosted by Sanlam Investments and Glacier by Sanlam in Johannesburg.
 

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