Argon Asset Management senior economist Thabi Leoka attributed the 3.2% decline of gross domestic product (GDP) for the first quarter of 2019 to a decrease in manufacturing, agriculture and mining sector.
Leoka says her forecast was a decline of about 1.6% but it doubled instead. She says the numbers aligned to the statistic released last week which showed an increase of 27% unemployment rate.
According to Leoka, this is happening at a time when investors are taking money out of developed markets into emerging markets.
Money should be flowing into South Africa and we should be seeing the rand scrapping somewhat but that would not happen if we are seeing such weak GDP numbers.— Thabi Leoka, Senior economist - Argon Asset Management
This is the time for very tough decisions for President Cyril Ramaphosa. Reforms are not easy, they are messy but reforms have to happen so that we can have sustainable growth in future.— Thabi Leoka, Senior economist - Argon Asset Management
To grow the economy, Leoka advises that there should be a special focus on mining and manufacturing sectors, which are high labour-absorbing and requires low skills.
South Africa is a developing country and we need to have policies that look towards improving the lives of the many people who are poor, marginalised, unemployed and not in training.— Thabi Leoka, Senior economist - Argon Asset Management
Leoka says the president needs to be very tough on underperforming ministers because at the moment the country's economy needs all hands on deck.
If there are any underperforming ministers and deputy ministers they need to shift...— Thabi Leoka, Senior economist - Argon Asset Management
To hear the rest of the conversation, listen below: