What will life be like under EFF? SA economists spill the beans

briefly.co.za

- briefly.co.za | 5 months ago

Leading economists are convinced that the proposed policies will burden the fiscus, worsen the already dire unemployment situation and drive away potential investors.

Dawie Roodt, chief economist for Efficient Group, agrees that funding for the EFF's plan will come from the South African taxpayer, adding that:“However, if the economy were to take a downturn, the lack of tax revenue would result in an unsustainable debt burden on government, which would result in prolonged periods of recession and capital flight from the economy,” According to The Citizen, the proposed economic growth detailed by the party was also over ambitious. Roodt explained that:“The expected growth rates of 6% in the first two years and 10% in the next three are largely unrealistic, given that structural problems in the education system and availability of skilled labour limit the ability of the economy to grow anywhere near the levels envisioned in the [National Development Plan] without high levels of overseas investment and pro-growth policies that allow productivity to increase.

”READ ALSO: Economists say the EFF's election manifesto is impractical and populistThe expert was scathing in his critical assessment of the manifesto, describing it an unrealistic and an impossible wish list:“It will cost hundreds of billions more, huge tax increases, will undermine the tax base and, ultimately, lead to weaker growth,”Roodt estimates that the cost of implementing the EFF's manifest at R300 billion with the potential for more costs:“But, keep in mind, it’s not only how much they will spend, it’s also the effect on the broader economy,”With Malema promising social grant payments double the current standard and a national minimum wage increase, Roodt believes the new minister of finance would be 'Father Christmas'.

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