World of trouble: the trends that should give SA a wake-up call
Breaking SA’s self-reinforcing stagnation is critical to an economic revival, especially in a tough global economy
Over the past 10 years the world economy has gradually recovered from the global financial crisis, growing by a respectable annual average of 3.8% from 2010 to 2019. This compares favourably with an average of 4.2% in the 10 years before the crisis.
The global economic recovery since 2010 has been mostly fuelled by ultra-loose and unconventional monetary policy, especially within developed economies. This appears to have distorted the global allocation of capital, resulting in a somewhat geographically uneven global economic recovery over the past 10 years. For example, the US achieved an average annual growth rate of 2.3% during that period, while the euro area expanded at an average of 1.5%.
In contrast with global economic trends, most of SA’s economic indicators have systematically weakened over the past 10 years. This includes GDP growth, which has averaged only 1.7% since 2010 and a mere 0.8% in the past five years...