Last week the Rand lost 3% in value, that’s a big a deal to those who may think this is a small loss but in this economic climate of high fuel prices, lack of consistent power supply and now a weak Rand, we, South Africans, maybe in for a hard year. A strong Rand used to somewhat offset increases in the oil price but that may not be the case today. So what can we say or better yet what are the economists and those in the Ministry of Finance and Treasury saying? Some have said its part of the global economic slow down led by the weakening American economy suffering the aftershocks of the Sub-Prime and credit crunch in capital markets. Others are saying that this is the curse of our economic growth. This has been the mantra by the government especially when it comes to electricity.

The curse of economic growth, really?! That sounds like rubbish to me. Are you telling me that when the pro-market Thabo Mbeki government was planning and selling to us the fruits of 6% annual economic growth, they either did not believe that themselves or they did not plan for it actually happening? You see to me either answer is equally disturbing because the government dropped the ball. Economic growth is a good thing but one should be prepared for the obvious social and incidental economic issues like a growing supply of credit to the masses, growing electricity grid etc. I get the feeling our government was not prepared for any of this, they were busy sharing money from BEE contracts and fighting themselves about who will rule in 2009. Now the country suffers. The scary thing is that these are our leaders. They seem not to be able to plan for anything.

Don’t get me wrong they could not have foreseen the American economy slowing down and the oil price rocketing north of US$50 per barrel but they could have planned that cities would grow and housing prices would go up thus requiring better city planning and inflation control. Tito Mboweni has tried to control inflation through interest rates but let’s be honest; there is a contradiction in the economic message. One government tongue is saying we want to grow at 6% per annum. So people would have more money to spend or access to credit because the government is upbeat about the economy. And the other government tongue is saying that we are spending too much and we drunk on credit. What are we to do? We have been waiting to buy new cars and new houses in the suburbs. Now that we can afford them or have access to them we are being told to exercise restraint.

Restraint and economic discipline are good things but when our government is spending over billions of Rand on a month long soccer tournament after having spent R50 billion on a few boats and aeroplanes in the Arms Deal, the government is not excising restraint its self. Our economic and political leaders are confused themselves and this permeates into the whole population. The government should have been clear about its expectations when it promoted 6% economic growth and this should have been spelled out to the rest of the population. Now we have a president and cabinet full of excuses and no answers. Fuel and food are expensive and this more likely than not will continue into the near future because our government cursed itself by not planning or believing economic growth would work.

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