With the 2Q16 having bounced back, and most sectors keeping this up through the 3Q16 as well, there is as yet no actual evidence of a fatal output sagging, but also no real indication of a new growth liveliness. Instead, slow continuity skimming close to the zero-line.

On the supply-side, the primary sector may lift a bit, the industry and services sector continue at slow speed, trade and income supported, infrastructure or labour disruption not intruding massively. Tourism has done well out of the weak Rand, farming is into recovery (wheat crop at 1.7mt some +17% on last year, latest maize crop estimate 7.3mt, but USDA expecting 13mt for summer 2017 â€" full recovery), even as the motor trade is in deep doldrums, reflecting a strong unwillingness to take on big-ticket commitments where existing value remains adequate.

On the demand-side, government has been austere in taming the budget deficit in times of tax revenue undershoots, business is reticent in the way it invests, restricts spending budgets and reduces labour in places, and households are cautious in holding back on big commitments.

It is a constrained picture offering itself, one that apparently refuses to start moving faster, each for good reason. A deep sense of unease as to future direction and outcomes, personally, at businesses, as well as in government confronted by real financial constraints.

And this before having to confront the next round of political power plays as narrow interests entrench themselves, but feeding market unease, weakening the Rand, jeopardizing our credit rating, undermining confidence anew.

Meanwhile, credit is restricted, private jobs being shed, frugality the norm, wage increases still in excess of inflation, but real benefits eroded away by charging municipalities and many others trying to improve their finances. With flexible remuneration probably in many instances also reduced or strained.

It keeps us on even keel, if restrained. Waiting for Godot. A nice juicy global windfall (not in sight…) or a government coming into different insights and setting in motion a recovery in spirit (also not quite in sight, indeed the opposite if we still face higher tax and interest burdens, much local government conflict and ongoing national political slapstick offering few solutions).

Slow growth to remain with us still for some considerable time. But with enhanced downside at the hands of politicians electing to ride roughshod over our national economic interests, bewildering the locals, keeping confidence subdued, risk-taking suppressed, stagnating in waiting mode. 

Cees Bruggemans

Bruggemans & Associates, Consulting Economists 

Website  www.bruggemans.co.za

Email. economics@bruggemans.co.za

Twitter  @ceesbruggemans

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