Damage from state capture 'worse than suspected' - SARB | Fin24
 
  • Still falling

    Annual consumer price inflation has dipped to its lowest level in 9 years.

  • Load Shedding

    Multiple systems failures at Eskom but grid remains stable and ‘won’t collapse’.

  • Digital Banking

    TymeBank says it will be switching gears in a bid to triple its size by the end of 2020.

Loading...

Damage from state capture 'worse than suspected' - SARB

Jun 06 2019 19:57
Khulekani Magubane, Fin24

The damage caused by state capture is "worse than originally suspected", Reserve Bank lead economist for regional policy David Fowkes has said, saying it had resulted in an environment of "major investment and no growth".

Speaking in Cape Town on Thursday evening during that city’s leg of the Reserve Bank’s monetary policy forum, Fowkes said it was a "puzzle" that economic growth in South Africa had not been higher.

According to latest figures from Statistics South Africa, the economy shrank by -3.2% quarter-on-quarter (seasonally adjusted and annualised) in the first quarter of 2019 – the biggest plunge since the 2008 global financial crisis, and the second highest drop seen in over two decades.

'Growth should be over 4%'

"One of the puzzles for us is over the post crisis period, investment hasn’t been particularly low. In fact, public investment has been rising," Fowkes said.

"With this labour pool and infrastructure investment, in a normally functioning economy, growth should be over 4% and there certainly hasn’t been growth," Fowkes said.

"This is the evidence of what state capture looks like," he said. "Where you have major investment and no growth.

"We suspect that the damage that has been caused by state capture is worse than originally suspected," he added.

reserve bank  |  state capture
NEXT ON FIN24X

 
 
 
 

Company Snapshot

Voting Booth

What do you think about private healthcare in SA?

Previous results · Suggest a vote

Loading...