We all know that our economy needs a major boost. Business Confidence is down again, and last year’s mood of optimism is rapidly fading. The silver lining is that if we can just turn those trends around and start on a path of increasing economic activity, both jobs and a rise in GDP will follow. Everyone will benefit.
But what can we actually do to get the economy moving again?
We discuss three interesting “quick win” ideas that could help. Hopefully government will take heed (and act accordingly), whilst entrepreneurs looking for “the next big thing” should also take note.
“I approach every problem with optimism” (Nelson Mandela)
The mood of optimism that pervaded a year ago is rapidly fading – the Business Confidence Index is on a steady decline. Every 1% rise in business confidence results in 0.5% growth in the economy – as President Ramaphosa recognises, growth in investment creates economic activity and from this flows jobs and a rise in GDP.
But there are always quick wins out there and these can start the momentum to getting the economy going again.
Boost tourism
Tourism doesn’t require a huge amount of upskilling but 20% of global jobs created in 2017 were in the tourism sector – youth and women are major beneficiaries of jobs and are two groups currently experiencing high unemployment.
To kick-start tourism, change the Visa requirements for tourists whereby they get a visa on arrival – if it’s easy for tourists to come here, they will definitely come. We are on similar time zones to Europe (our main trading market), have a beautiful coastline and interior plus wildlife and have an interesting story to tell.
Building infrastructure for tourism is relatively easy and quick – for example, look at the number of B&Bs and Airbnb in your area. In Costa Rica, 27% of GDP comes from tourism.
Make it easy to do business
South Africa ranks 82 out of 190 economies on the world index in terms of ease of doing business – our worst ranking ever. With will and leadership, this can be swiftly changed. Government has targeted to bring this down to being in the top 50 in the next 3 years, but four years ago we were in the top 40 (our best ranking was 32 in 2008). Surely, this can be done quickly.
Build housing
Maggie Thatcher showed what a difference housing can make not just for the economy but also for long term sustainability. Housing gets construction moving (a quick job creator), stimulates the service economy (bonds and insurance) and there is plenty of value added in terms of appliances, gardens etc.
More important, encouraging ownership of property brings more people into the middle class which gives them a stake in ensuring stability in the nation.