Release of State capture report potentially positive for the economy
The potential economic impact of former Public Protector Thuli Madonsela’s ‘State of Capture’ report could be positive at a time when South Africa needs it, stated North-West University School of Business and Governance economist Professor Raymond Parsons in a statement on Thursday.
He noted that effective institutions, seen to be working, are good for public and business confidence, as they reinforce the impression of 'institutional resilience' in the country and an upholding of the rule of law.
Parsons added that the strengthening of the rand on the news is partly a positive market reaction to the right decisions being seen to be made.
“The economic and business outlook remains mixed, but weak business and consumer confidence remain at low levels,” he said.
Parsons noted that South Africa’s economy is not yet out of the woods and recent positive developments need to be sustained to create a constructive turning point.
“While the political dynamics in the country remain highly uncertain and may still surprise or shock, the release of the report might be an additional factor encouraging the credit rating agencies to give South Africa the benefit of the doubt and more time to get its house in order,” he said.
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