Africa-Press – South-Africa. South Africa’s job crisis may have more to do with politics than economics.
That’s according to News24 journalist Carol Paton, who, in her latest piece, notes that despite years of economic plans, job creation in the country remains stagnant.
She points to political instability and inconsistent policies as hindering investment.
“If you look at what causes economic problems, and what causes the lack of investment, you find that it’s actually political things.”
Paton lists weak consumer confidence and business confidence, noting that ‘without spending, you don’t get growth’.
Many economic problems actually have their origin in political problems, says Paton.
“What I’m lobbying for is to say, let’s deal with these political blockages because these are the actual constraints to investment in our economy.”
She says declining business confidence since 2015 has played a direct role in slowing employment.
“Over time, the ANC government moved further and further away from prioritising investment and sort of stacked economic policy with a whole lot of secondary demands.”
Those demands included BBB-EE and localisation, and Paton highlights the difficulty in achieving transformation goals while also attracting investment.
Essentially, requiring investors to ‘jump through hoops’ became off-putting.
“Those things just add costs, and they undermine returns.”
Another factor to consider is the high political uncertainty, explains Paton.
“The growing uncertainty in the period leading up to last year, when we were taken off the grey list, the growing uncertainty amongst lenders in the capital markets about whether South Africa could actually repay their debt or not, upped the price of borrowing for government.”
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