South Africa is in big trouble, as clearly shown when looking at key economic indicators.
Stats SA has released its latest unemployment figures – Q3 2018 – which reveal that the unemployment rate in the country is now at 27.5%.
The local economy has also suffered from slow to no growth in recent years, and the country was recently classified as being in a technical recession.
Interest rates are also expected to rise in the coming years to contain rising inflation, which will place pressure on businesses and consumers.
This has resulted in many South Africans fearing the worst for the country and leaving it to pursue better opportunities overseas.
The four graphs below show the challenges South Africa faces.
Unemployment continues to remain high in South Africa, with the latest official figure measured at 27.5%.
This has risen from above 20% in late 2008, and is a sign that the economy is not taking on more jobs.
The government has focused much of its efforts of job creation, but many economists have pointed to “anti-business” ANC policies and powerful labour unions as barriers to business growth and job creation.
Endemic corruption at state-owned enterprises and government departments has also resulted in billions being stolen and misspent – further hurting job creation and service delivery.
A subset of the unemployment data which is crucial to look at is the long-term unemployment rate in the country.
The long-term unemployment rate measures those who have been unemployed for a year or longer.
The long-term unemployment rate in South Africa has increased from 59.4% in Q3 2008 to 68.8% in Q3 2018 – along with an overall increase in the unemployment rate.
This means that more people are remaining unemployed for longer in South Africa.
The rand-dollar exchange rate is a good measure of the local currency’s strength in the international market.
It also plays a key role in determining how much South Africans pay for a range of goods – particularly technology goods like smartphones and PCs.
Over the past 20 years, the rand has gone from around R6.00 to the US dollar to the current level of just below R15.00.
There are strong peaks and swings during this period, but the trend since 2011 has been a sharp depreciation of the rand against the dollar.
South Africa’s government debt is up to 55.8% of GDP, and Finance Minister Tito Mboweni has stated that an acceptable figure is below 50%.
The country may be driven to the International Monetary Fund if its rising debt goes unchecked, without the buffer of savings or new sources of tax revenue, said the National Planning Commission recently.
Debt is increasing against weak economic growth and while high unemployment continues, and the higher debt could further reduce commitments to social spending.
“The bad news is that we have stalled once again… it will not be possible to continue on this path,” said the commision.
“We will need to restore the country to a growth path with higher tax-collection rates, public-sector efficiency, and improved service delivery per rand spent.”