THE IMPACT OF THE ECONOMIC CRISIS ON SOUTH AFRICA AND ITS EFFECTS ON POTENTIAL DEVELOPMENT
Introduction
All countries across the world are affected by the most severe economic crisis in the last 80 years. The crisis was caused by a range of factors including gross imbalances and inequities in the global economic system, the impact of the financialisation of economies, ineffectual guidelines in several of the major world economies and poor business practices, has resulted in significant asset depreciation, closures of companies, rising unemployment and a slowing down of economic growth, with most highly industrialised countries entering a recession.
EFFECTS OF THE FINANCIAL CRISIS
Like other developing countries which are strongly integrated into the world economy and significantly dependent on its good health, South Africa has been affected by the sharp fall in demand for its export products and the fall in prices of key export commodities. The international credit crisis has meant that funds have become scarce and expensive and that portfolio investors are wary of emerging markets such as South Africa. (www.onlyinsouthafrica.com)
The Essay on South Africa Strenght and Weaknesses Notes
As a nation, South Africa possesses economic and social strengths that can help it develop a successful IT industry within the country. However, its weakness can derail its success quite easily. Luckily, South Africa has the opportunity to reduce those weaknesses through government policy and increased financial support for IT development. However, should South Africa choose not to take advantage ...
The result is that our growth expectations had to be sharply revised, downwards. The period and intensity of the downturn cant be forecasted with certainty, but growth is likely to be lower than previously expected at least in 2009, and 2010. This has potential implications for household incomes, employment, and investment and on social programmes partly through the slowdown’s effect on tax revenues for government. (www.amandlapublishers.co.za)
In the difficult conditions that face South Africa, the government must utilise their strengths, in fiscal space, the financial regulatory framework and the resourcefulness of its citizens and institutions, to develop a response to the crisis and to commit to working together in addressing its impact on South Africa. (www.reuters.co.za)
South Africa needs social unity between all South African citizens to ensure that the crisis doesn’t damage the structure of our society. The collective responsibility is to work together to withstand the crisis and ensure that the poor and the most vulnerable are protected as far as possible from its impact. The government must also ensure that the economy is ready to take advantage of the next upturn and that the benefits of such growth are shared by all citizens.(www.un.org)
THE POTENTIAL OF SOUTH AFRICA
The main issue of South Africa’s response to the downturn is that low income workers, the unemployed and the vulnerable groups can lose alot through even a relatively small economic shock, and the risk of unfairly placing the burden of the downturn on the poor and the vulnerable must be avoided. The potential of economic shocks to weaken the welfare of the vulnerable, including their jobs, health and education, and to increase inequality and poverty, is widely recognised. This is a major concern and will require active steps to ensure these outcomes are avoided. (www.southafrica.info)
South Africa ensures that all of the activities that are aimed at strengthening the capacity of the economy to grow and create decent jobs to increase the level of employment and improve the quality of jobs and in the future are protected and supported. This can be achieved by agreeing on the need to address the constraints to growth and development through programmes: to increase public investment in economic infrastructure, to deepen the joint stakeholder commitment to skills development, to act immediately on the commitment to introduce effective sector strategies or improve existing strategies, and to ensure higher levels of private sector investment and entrepreneurship, to improve economic efficiency and to commit to macroeconomic policies that support decent work and sustainable growth. (www.web.worldbank.org)
The Term Paper on South Africa 6
Afrikaans and English are the official languages. Afrikaans, derived from Dutch, is the mother tongue of the Afrikaners and the principal language of the Coloreds. More Afrikaners are bilingual than English-speakers. Most urban blacks speak English and Afrikaans in addition to their native language. The Bantu languages are not mutually intelligible. Many blacks speak Fanakalo, a lingua franca that ...
South Africa should try to be more committed in maintaining the planned high levels of investment in public sector infrastructure and to encourage the private sector to maintain and develop where possible their levels of fixed direct investment and continue with corporate social investment programmes.
Conclusion
Actions to neutralize the downturn must be reviewed at regular intervals, and disposed of when they are no longer effective. South Africa must remain conscious of the risk of developing interventions that have short term benefits but have the potential for negative long-term social or economic effects andshould pursue the transformation of informal economy activities and its integration into the formal economy.
References
Legassick, M. (2010).
Notes on the South African economic crises. Retrieved September 06 2010 from http://www.amandlapublishers.co.za/home-menu-items.html
United Nations, New York (2009), World economic situation and prospects 2009
http://www.un.org/esa/policy/wess/wesp.html
Reuters, (2009), SA budget deficit grows. Retrieved September 06 2010 from
The global financial crisis and South Africa,
The Term Paper on Republic of South Africa
South Africa contains some of the oldest archaeological sites in the world.[19][20][21] Extensive fossil remains at the Sterkfontein, Kromdraai and Makapansgat caves suggest that various australopithecines existed in South Africa from about three million years ago.[22] These were succeeded by various species of Homo, including Homo habilis, Homo erectus and modern humans, Homo sapiens. Settlements ...
South Africa ‘cool during crisis’ ,
http://www.southafrica.info/news/business/860372.htm
Prospects for the Global Economy,
