This year South Africa has experienced a huge economic knock. We've been downgraded to junk status, entered a technical recession and have an extremely high unemployment rate.
According to economic strategist Thabi Leoka, these are the challenges that are hindering our economic growth. They also make it difficult to interpret the economy.
The South African economy is dynamic. It's noisy and currently it is very difficult to read. There are so many moving parts. The political overlay currently is influencing the trajectory of the economy.— Thabi Leoka, Economic strategist
One of the biggest challenges facing South Africa is the high amount of extreme poverty in the country. Yesterday, Stats SA’S Poverty Trends report revealed that the number of people living in extreme poverty increased to nearly 14 million between 2011 and 2015.
With so many of the working force living in poverty, Leoka says it is difficult for the economy to grow. This is disappointing for her she says because as a developing country, South Africa should be improving.
You see things like unemployment and the poverty report released by Stats SA and you think, a country like South Africa who has done so much, should be improving not regressing, especially with poverty levels.— Thabi Leoka, Economic strategist
This is because the country has matured in so many other aspects according to Leoka. She says corporate South Africa is doing quite well, although they could do more.
There are also institutions in government that focus on the economy and who do great ground work for enhancement, but, Leoka says they need to work more optimally. This is especially important when it comes to tackling poor performing sectors like mining or high unemployment rates.
As a country whose unemployment rate is about 28 %, you can't really grow an economy well or significantly if your working population is not working, discouraged or has stopped looking for a job.— Thabi Leoka, Economic strategist
One of the factors that upset or frustrate many South African's is our turbulent government's effect on the economy. Leoka says while she understands the frustration, she feels that we have a part to play to change this rather than just criticise.
According to Leoka, corporate SA has a huge amount of power and should be engaging and be putting pressure on government to make a change for the better.
Leoka will be part of the Lead SA Change Makers conference, where she will be sharing more insights.
To listen to the full interview listen below: