Since yesterday September 5, 2018 around 12:00 it was announced that South Africa is in an official recession. Nearly everyone read about it with great concern, but few realize exactly what it entails.
A recession suggests a phase of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters. The current recession in the country was caused by the debate about land expropriation without compensation, which undermined a very principle of the freemarket system; and the full particulars of the thuggery and corruption from Zumagate now becoming public.
These two factors combined to make foreign investors withdrawing funds from South Africa. It also left the door open for China to offer a $60 billion loan to us, not because of economic reasons, for China is itself experiencing hard economic times, but because of the future political influence and dumping of surplus people and inferior products. China did exactly the same in Venezuela a week ago and for roughly the same amount, $62 billion. The national debt rose above R3 trillion yesterday, which means South Africa will have to pay back an INTEREST payment of R5 600 PER SECOND. That means that every man, woman and child in South Africa now has a government debt of R55 700!
A recession is when the economy declines significantly for at least six months (two quarters). That means there’s a drop in the following five economic indicators: real GDP, income, employment, manufacturing, and retail sales.
For the man in the street this means that the ANC’s irresponsible corruption, inefficiency and cadre employment and enrichment are now forcing up food prices, household goods, petrol, interest rates. A country where about 76% of your income is already taken by direct and indirect taxes just cannot afford this.
Greece, Argentina, Ireland, Egypt, Zimbabwe and Venezuela are recent examples of irresponsible governing parties sinking their own economies. If a recession should accelerate, as is likely to happen under Ramaphosa and the Chinese cartel, a country goes into a full-scale depression. South Africa experienced that 80 years ago and it was devastating.
The Great Depression of the Thirties caused famine, unemployment and general poverty even among the higher middle class. It also lead to the the first change in governing party in the Union of South Africa in the resulting general election.
The ANC and EFF are on trial. They try their best to shift their blame to individuals, but it is not going to fool Siphiwe or Hettie much longer than May next year’s election. They can deny it and try to blame white monopoly capital, Jan van Riebeeck or Chuck Norris, the fact is that it is the ANC and EFF causing the higher fuel price, higher bread prices, empty shelves, the replacement of reliable products with Chinese and Pakistani junk and all the other economic ills.
Please explain to Nohlanhla why she is going to pay R20 for a bread and R25 for a litre of milk, before you expect her to vote for the thugs of the ANC and EFF again.