Recently, Nigeria experienced an economic recession and that should be a warning to other African economies, especially South Africa. For ages, there have been various issues that affect the economic growth of South Africa. Generally, the low household expenditure in South Africa is a clear indication that its growth remains relatively low, despite the nation being among the biggest economies in Africa. Besides, the household consumption expenditure in the Rainbow Nation remains subdued and restrained as shown by the low growth in retail sales. Furthermore, political situations in the country continue to heave more pressures on the fragile Rand. The instability of the political setup has seen the ruling party – the ANC lose some seats in the local municipality elections as the locals protest at the government’s lack of tackling the rising economic crisis. The situation is made worse by the pressures emanating from the demands of food and oil, thereby potentially laying the ground for an inflationary bout in the future. The high unemployment rates in South Africa – one of the highest in the world, only serve as an indication of the implications of the weak economy.
Moreover, the inequality exhibited by the delivery of vital services in the country showcases signs of a steadily weaker economy, given that municipalities cannot offer vital services such as water, electricity, sanitation and healthcare. A strong economy has the capability of transforming the lives of the local citizens in that the positive impacts trickles down to the basic amenities such as healthcare, water, education, security, electricity and sanitation. Improved public service signals the improvement of an economy in that it makes it easier for the locals to benefit from an enhanced economic platform. South Africa has witnessed more demonstrations by citizens to express their displeasure with the poor services they get from the municipalities than it has seen politically instigated demonstrations. The failure to tackle corruption and rejuvenate the stagnant economy in South Africa saw President Zuma’s ANC lose its grip on major cities during the municipal elections – ANC lost in the capital Pretoria, the economic hub of Johannesburg and also in Cape Town. The party only won in Durban – the stronghold of President Zuma. In some of the cities, ANC lost to a combined effort of the Democratic Alliance and the Economic Freedom Fighters party that is led by the highly rebellious Julius Malema.
The slumps in prices of commodities have also affected most corporations, hence forcing them to sell off assets or lay off some workers. The fragile situation can be seen when the country had three different finance ministers in a span of one week as well as the fragile and inconsistent stocks market. The recent demonstrations by university students as regards the increased fees only aid in showing how the South African government has failed; actually, Zuma has failed to deal with situations that arise from a weak economy hence affecting vital services such as education in institutions of higher learning. The disparities in wealth among the locals in South Africa showcase a situation whereby the economy is not good enough to support the poor people. Matters haven’t been helped by the racial disparities with the majority of blacks feeling that the ANC had “sold them out” to the whites. In short, more blacks feel that Zuma and other ANC elites have auctioned them to the economic interests of the whites leaving them poorer!
With a blueprint that reflects ideals of economic transformation, the Democratic Alliance has been able to brand itself as the only savior to the ailing South African economy. In actuality, the win by the Democratic Alliance in most municipalities in South Africa only reflects the mood on the ground as regards Zuma’s inability to initiate economic growth. What’s more? With the socialist Economic Freedom Fighters (EFF) backing the Democratic Alliance, things could even get worse for Zuma and the ANC. It is instructive to note that the Economic Freedom Fighters (EFF) is a party that broke away from the ANC Youth League. The ANC lost to the opposition in areas that have an economically diverse setup for instance cities like Johannesburg, Pretoria and Cape Town, and retained the seats in rural areas. That means the communities and organizations that make up the foundation for economic prosperity find it hard to resonate with how Zuma’s government has handled the economic situation. In short, they do not find Zuma as the right leader to jump start the ailing South African economy. What’s South Africa’s most salient panacea as regards its impending economic turmoil?
By Martin Wakaba – an aspiring entrepreneur who has several startup projects