Chief economist at Economists.co.za Mike Schüssler has said that the South African economy is quickly heading towards “zero, or even negative growth”.
According to a report by Moneyweb, Schüssler based his statement on the BankservAfrica Economic Transaction Index – which measures SA payment system transactions smaller than R5 million.
The Index showed that “economic transactions in January to be up by 0.1%, compared to a year prior”.
“They were down 0.2% quarter-on-quarter, and 0.4% month-on-month,” stated the report.
Schüssler said the numbers showed that the economy has been hit by “a perfect storm of events”.
“The economy is not doing well whatsoever, and there’s lots of evidence to support that fact,” said Schüssler.
“Whether you’re looking at car sales, tax collection, manufacturing sector data, or the Purchasing Managers Index data, it’s quite clear that the South African economy has been hit hard by commodity prices.”
Massive job losses coming
Schüssler said the country faces job losses in the tens of thousands in the coming months, as companies deal with the tough economy.
“I’m very concerned about where we are in the business cycle, because we can’t say this is normal,” he said.