Renowned economist Dawie Roodt shared his predictions about South Africa’s economy in 2024, and they are mostly bad news.
Speaking to Ontbytsake, Roodt said he did a few forecasts related to the country’s finances, which do not paint a pretty picture.
He shared four predictions for the year ahead:
- 2024 elections – It is an election year which creates uncertainty and volatility. The private sector does not like uncertainty, which will limit investments. It means that not much will happen until the elections are over and will have a drag on the rest of the year.
- Economic growth – Because of the lack of investment and increased uncertainty, economic growth is likely to be low. South Africa will be lucky to achieve 1% growth. On a per-capita basis, people will get poorer.
- State finances – South Africa’s fiscal accounts are in deep trouble – not only the national government but also municipalities and state-owned enterprises. People should expect bad news during the Finance Minister’s 2024 budget speech later this month.
- Inflation – The worst inflation in South Africa and internationally is behind us. We may see a further decline in inflation, which will result in interest rate cuts.
“2024 will be a very difficult year for the South African economy. However, lower interest rates are the silver lining to the dark cloud,” he said.
Dawie Roodt’s advice to people staying in South Africa
Roodt previously said that despite the challenges, there is no reason to leave South Africa. However, those staying should make the right choices and protect their wealth.
The first is that people should ensure they are safe. This may involve living in a security estate and avoiding risky situations.
They must also have the skills and technology required to participate in the advanced global economy.
Turning to wealth, Roodt advised South Africans to have a diversified portfolio, with a large portion invested abroad.
Apart from protecting your wealth against political and economic problems in South Africa, there are also more investment opportunities in international markets.
“Make sure you use the correct structures when moving money abroad. Get a good advisor to assist you,” he said.
One of the reasons Roodt feels that it is unnecessary to leave South Africa is because it is possible to work for global companies from anywhere.
“Economies today are not as physical as they used to be. This makes it possible to stay in South Africa and work in the global economy,” he said.