SA economy in distress

post-title

“We need a new perspective of doing business in Africa. Looking at the economic trajectory both locally and internationally for the next six to 12 months, more businesses are likely to become distressed. Now’s the time to act,” says Alastair Macduff, chairman and CEO of the Turnaround Management Association (TMA), Southern Africa.

According to the TMA, business confidence in South Africa is at an all-time low. Businesses are feeling the impact of low investor confidence, weakening exchange rates and high fiscal uncertainty. Restoring investor, business and consumer confidence will require a concerted effort to address these pressing issues - and address them in the best interests of the country as a whole, says Macduff.

Efforts need to be focused on the existing unemployment problem, which must be seen as a priority. Investor-friendly policy amendments and structures to mitigate confusion around the Mining Charter, energy policy and dealing with state-owned enterprise debt also require urgent attention.

The good news, says Macduff, is that South Africa has a relatively open economy, as well as a resilient business resolve. He says:

"To survive the current landscape, improved productivity and efficiency as well as diversified skills and flexibility will be paramount. Businesses will also need to find ways to decrease infrastructure and reduce financial risk in their environments. And while growth will come from areas such as inbound investments, exports, investment in Africa and foreign acquisitions for example, the restructuring and rescue industry will have a critical role to play in helping business transition to new and more effective business models in a turbulent setting."

Related articles

Top