Browsing: GDP

South Africa economic outlook 2022

In terms of the fiscus, South Africa expects to run a deficit of -4.1 per cent in 2023, however, the deficit is expected to narrow for the next 3 years closing 2026 at -3.6 per cent. This demonstrates significant fiscal consolidation.

Over the next 3 years the South African government expects to consolidate its public finances and reduce its deficit by inter alia increasing revenues and or managing or containing costs. According to Investec, “The current fiscal year (2022/23) has seen a substantial boost to nominal (actual) GDP due to high inflation, which has eased both the fiscal debt and deficit projections as a per cent of GDP, although does not boost real GDP, which is the measure of the country’s growth and has the distorting effect of inflation removed.”

Among countries in Africa, South Africa is getting its public financial act together. The country is paying down its debts, inflation has been showing a strong downward trajectory. What remains to be seen is whether this decreasing inflation rate will continue.

Angola is also rich in other minerals like iron ores, diamonds, gold, marble and phosphate deposits. The embassy of Angola’s economic outlook indicates that from the 1950s through 1975, iron ores were explored in provinces such as Malange, Bié, Huambo, and Huíla, and average output reached 5.7 million tonnes per year between 1970 and 1974.

The most explored minerals were exported to Japan, Germany, and the United Kingdom, earning Angola US$50 million a year.

Angola’s phosphate deposits are estimated at 150 million tonnes, located in the provinces of Cabinda and Záire. These resources have so far been unexplored. In Southeastern Angola in the provinces of Namibe and Huíla, marble, granite, and quartz reserves abound. Marble is especially consumed in the local market, while black granite is on demand and exported to United States and Japanese markets.

The high-interest rates have made the United States dollar more appealing to investors who are piling into the greenback. The value of other currencies has tumbled: the pound, yuan, euro, and the yen. This depreciation in other currencies makes imports for these countries more expensive in United States dollars. The case for a recession caused by a strong dollar is grimmer in Africa where just about every country on the continent is overextended in terms of United States dollar-denominated borrowings.

Repaying loans in hard currency will be more expensive, especially where their currencies are rapidly depreciating.

The strong US dollar according to CNN has a destabilizing effect on Wall Street.

Companies listed on that bourse conduct business internationally, and a strong dollar will negatively impact their earnings. The second marker of the global economic recession is that US economy is slowing down or stalling. The world’s largest economy is driven by consumption.

This year’s current account surplus was replaced by a deficit of 1.8 per cent of GDP and a budget deficit of 2.9 per cent in 2020, respectively.
A depreciation of ZWL2.5 to the US dollar was recorded in February 2019 before stabilizing at ZWL82 in December 2020. Unemployment remained high in 2019 at over 21 per cent, with poverty at 70.5 per cent and unemployment at 70.5 per cent respectively.
Currently, the banking sector is sound.