SA went through a period of economic stagnation between 2010 and 2017 that an economist has called ‘lost years’.
A report released late last week by Stellenbosch’s Bureau for Economic Research (BER) paints a dismal picture of possible lost opportunity that took place during the years Jacob Zuma was president.
BER economist Harry Kemp’s paper, “Ten Years After the Lehman collapse: SA’s Post-crisis Performance in Perspective”, found the SA economy could have been 30% larger, with half a million to 2.5 million more jobs if the country could have kept up with the pace of other emerging economies over the past eight years, as it had been doing prior to Zuma’s rise to power.
According to Stats SA, South Africa’s unemployment rate currently stands at 27.2%.
Government could have collected between R500 billion or even R1 trillion more in tax revenue, which was curtailed by the economy’s poor performance and a loss of efficiency in tax collection.
Kemp considers the period between 2010 and 2017 “lost years”.
Although Kemp took into account the weakening effect of the global financial crisis of 2009, South Africa was not able to match the surge of global growth that came after the world recession, which would have seen real GDP at nearly R500 billion higher (15.4%) by the end of last year, Kemp estimated.
He blamed primarily “domestic factors” for the economy’s dismal performance, not international pressures.
He named these as “falling confidence, widespread policy uncertainty, mismanagement of state resources, and various other structural constraints which conspired to weigh on domestic economic activity”.
While president, Zuma often blamed the 2008/09 financial crisis for South Africa’s poor economic performance. The Ciziten.
