This is the future – Stagnant Milan a warning for SA | Fin24

This is the future – Stagnant Milan a warning for SA

Jan 11 2017 15:13

The 47th annual meeting of the World Economic Forum is just around the corner. From Monday I’ll be rubbing shoulders with a record 3 000 participants from 70 countries.

The SA delegation is led by President Jacob Zuma and Finmin Pravin Gordhan. Observing the dynamics between them introduced a fascinating dimension.

This year we decided to travel to Davos via Italy. It was edifying. Landing in Milan provided first hand experience of what happens to a great city when the economy stops growing. Italian GDP has literally gone nowhere in a decade and a half. The last time economic growth hit a modest 2% was, briefly, in 1984.

Milan, once a thriving industrial complex, reflects the result of the socialist economics that have been so ruinous for this country. The first thing to hit you is the graffiti. It’s everywhere, squeezed into every available wall, defacing buildings that last saw a tin of paint decades ago.

As telling, in a half hour drive around the city I didn’t see a single crane. Not one. There is no new building going on. Such is the consequence of economic stagnation.

For the last five years, South Africa’s GDP per capita has fallen annually. That means the economy is growing slower than the population. Instead of re-assessing, those pulling the economic levers are determined to amplify the approach which got us here. If you thought education was expensive, try ignorance.

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