South Africa

Dawie Roodt’s encouraging message about South Africa

Dawie Roodt

Renowned economist Dawie Roodt said a positive outcome in the 2024 elections could bolster markets, strengthen the rand, and help grow the economy.

Roodt discussed the impact of South Africa’s 2024 general elections with Nuuspod’s Izak du Plessis.

He said South African assets, including the local currency, capital market, and stock exchange, are significantly undervalued.

Should there be a favourable 2024 election outcome, South Africa will become a ‘good news story’.

“A good news story will result in the rand strengthening dramatically, lower interest rates, and confidence returning to the economy,” Roodt said.

However, there is the risk of a negative outcome. This includes the ANC forming a coalition with the EFF.

This scenario can lead to ultra-left, ideologically-driven policies, which can cause tremendous damage to the country.

The EFF said it expects no outright winner to emerge from next month’s elections and is positioning itself as a kingmaker to determine who will run the country.

The party has said it wants land to be expropriated without compensation and for all mines to be nationalised.

“From a policy perspective, it shouldn’t be difficult for the EFF and the ANC and MK” and like-minded parties to find common ground,” EFF leader Julius Malema said.

He added that he is prepared to give their vote to the ANC nationally with one demand – make Floyd Shivambu South Africa’s finance minister.

The prospect of a coalition between the ANC and the EFF has unnerved investors. Roodt said he is also concerned about this happening.

However, this is not the only outcome. There are many other possibilities which will be good for the country.

It includes a government of national unity, where parties like the DA and the Freedom Front Plus can play a meaningful role.

“There is an opportunity for South Africans to send the country in the right political direction, which will bolster the economy,” Roodt said.

Roodt added that the financial markets are unforgiving and punish poor economic decisions quickly and harshly.

That means even if there is a leftist coalition with destructive ideologies, they will not escape the market’s reaction to their decisions.

“Even if Floyd Shivambu is the new Finance Minister, he will have to think twice before doing something stupid,” Roodt said.


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