South Africa in recession after land threat

Cyril Ramaphosa

South Africa in Recession After Land Threat ‘Shocking Drop in Agriculture’ Lintao Zhang Getty 4 Sep 2018

"The decline starkly demonstrates that, in the absence of a coherent policy framework, businesses avoid risk, do not invest and grow, and certainly do not create jobs", she averred. "The optics of South Africa are poor". "This means that citizens' incomes have been declining and the trend shows no sign of abating".

The direction of travel of the economy now means the government can not afford to waste time in implementing market-friendly policies, while it would also do well to jettison those populist policies that diminish the view of South Africa as an attractive investment destination amongst worldwide investors.

According to the gross domestic product (GDP), 2nd Quarter 2018 report published by Statistics South Africa on Tuesday, the country's agriculture sector is the hardest hit, with a decline of 29 percent.

Industry sectors which saw growth included mining, construction, electricity, finance and personal services. The economy grew 0.4% from a year earlier. South African household consumption expenditure fell in the second quarter of 2018 compared with the first quarter of 2018, in line with the fall in retail trade sales.

As the country gears up for elections next year, which Ramaphosa's ANC is still likely to win although its support might dip, the main opposition Democratic Alliance said the latest bleak economic data called for "real leadership".

Until investors have greater clarity on policy issues such as land redistribution and mining, he expects to see this number remain in negative territory.

He says government's confident it can turn the situation around.

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Williams took the first set against Kanepi in just 18 minutes. "It wasn't an easy match at all, Williams said after the match". Now, I mean, we definitely want to continue to play, but it's not like we're 18 and 19 any more.

It comes at the time when lawmakers are reviewing the nation's constitution to make it possible to expropriate land without compensation.

"We believe that once the threat of a ratings downgrade and the medium-term budget statement has passed in October there might be an opportunity to buy ZAR assets", said Christopher Shiells, senior emerging market analyst at Informa Global Markets.

South Africa is now in recession for the first time since 2009, data released on Tuesday showed.

Also, just shortly after Nigeria exited recession, the All Progressives Congress (APC) said the success recorded was achieved through the leadership of President Muhammadu Buhari.

"There must be no renewed lapses in fiscal consolidation".

The outcome casts a pall over the country's new leadership, providing an uncomfortable parallel with the initial phase nine years of Ramaphosa's predecessor, Jacob Zuma.

At its last meeting in July, the MPC kept the repo rate unchanged at 6.5% per annum.

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