Getting to grips with the next 20 years
What will South Africa and the world look like in the next two decades? A local scenario planner and an international futurist provide some answers.
All sectors of the economy need to have a proper u ndersta nding of t he world we live in and how changes in that world will impact us. At a recent investment intelligence conference, co-hosted by Glacier and Sanlam Investments in Johannesburg and Cape Town, a team of experts shared their views on how to shape up for the changes and challenges that lie ahead.
SA STUCK IN A RUT
Frans Cronjé, CEO of the Institute of Race Relations, author and scenario planner, can’t see how South Africa will turn the ship around anytime soon. “Just like a household that is running out of money, the South African government has l imited options,” he says. The government’s current economic policy doesn’t allow for the economy to grow any faster, while borrowing more money is also off the table due to our high debtto-GDP ratio.
“Through t he ANC’s s hrewd economic management in the late 1990s, it managed to bring down debt levels into the 20 percentiles, but that picked up again in the global f inancial crisis. The crisis passed, but debt levels have continued to escalate,” Cronjé says.
“By the end of this year we’ll be back at the debt-to-GDP ratio we were at during apartheid. We’re experiencing disinvestment, violent protests and uncertainty – this in an era during which other emerging markets are leading global economic growth and have overtaken advanced economies in purchasing power terms.”
While government hopes to reinvigorate the manufacturing sector, the unreliable electricity supply could be a stumbling block.