Tutwa New Header

Dear [subscriber:firstname | default:reader]

Welcome to the first edition of Tutwa Newsletter for 2019. The year has already started off at a high pace. On the global front, there is a sense of foreboding about the slump in economic activity and overall growth outlook. The forecast for some of the major economies, both emerging and advanced industrial economies, is on the downside. The trade wars and ratcheting up of geopolitical tensions between the US and China could induce a further slowdown in global growth and dampen confidence in multilateral institutions.

Given the central place occupied by these two countries in the global economy, escalation of tensions between them will have an effect on global trade and supply chains, especially if they dig their heels deeper on their trade impasse. The hostilities between these two countries intensified when the US imposed tariffs to the value of $250bn on Chinese goods in the past year, with China retaliating with its own tariffs $110bn. The attempt at resuscitating the bridge of diplomacy on the sidelines of the G20 in December 2018, where both agreed to a 90-day cessation of hostilities, seems to be flagging already as the US has turned down China’s offer for a preparatory talk.

Both countries will take the strain from a prolonged trade standoff. Compounded by a range of systemic risks that are underlined in the World Economic Forum Global Risks Report 2019, the showdown between these two countries will no doubt have a knock-on effect on the global economy, with weaker countries affected more adversely.

As a portent of things to come, the IMF Managing Director Christine Lagarde announced at the start of the WEF meeting in Davos that the IMF modestly cut its global growth forecast for 2019 to 3.5% from 3.7%. In this newsletter we take a closer look at this global picture, highlighting 5 key challenges that global leaders will need to focus on in the year ahead.

We also take a look at developments in the Sub-Saharan Africa region. In an article by Faith Tigere, Anna Ngarachu and Lesley Wentworth, the region’s governance and economic challenges, especially growing debt as a threat to social stability, are laid bare. The article offers insights on governance and debt situation in the region.

We then assess the political and economic situation in South Africa with a greater focus on elections, institutional malaise, and economic underperformance. Azwimpheleli Langalanga and Heinrich Krogman offer analysis of the state of readiness of the governing party, the ANC, as well as the official opposition party, the Democratic Alliance, towards the general elections that are expected to be held in May 2019. The major challenge facing South Africa that the article cast its spotlight on is economic underperformance and institutional weaknesses.

The last article takes a positive look at the upcoming state visit to India by President Cyril Ramaphosa. President Ramaphosa is accompanied by some of the senior ministers and a hefty business delegation. The central theme is on economic diplomacy, and showcasing South Africa’s readiness for business. Success rests largely on getting reforms right at the domestic level and effective coordination between government and business in external engagements.

We hope you enjoy the analyses offered by various articles from global challenges to regional developments to political contestations in South Africa

Five Challenges Facing Global Leaders in 2019

Mzukisi Qobo
As global leaders meet for the World Economic Forum’s annual event at Davos this week, there are five major global challenges that they will need to respond to. These include strains occasioned by global power shifts, turbulence in major emerging economies, growing geopolitical and trade tensions between great powers, Africa’s weak integration in new forms of global production, and a …
Read more

Governance Failure and Debt: Sub-Saharan’s Africa Dual Challenges

Faith Tigere and Anna Ngarachu with Lesley

Wentworth Towards the end of 2017 and the beginning of 2018, a wave of political reforms swept across Southern Africa with widespread optimism and the promise of change. The ousting of Zimbabwe’s geriatric president, Robert Mugabe in November 2017 after 37 years of rule and replacement by Emerson Mnangagwa was a welcome transition …
Read more

South Africa’s Political and Economic Outlook in 2019: Elections, Lawfare, and Economic Policy Choices

Azwimpheleli Langalanga and Heinrich Krogman

Turbulence in SA Politics South Africa will go for its 6th general election during the first two weeks of May 2019. These elections come at a time when South Africa is facing economic headwinds, allegations of corruption implicating high-profile politicians, and the tide of institutional erosion of the past decade seems hard to turn. There …
Read more

Strengthening Economic Ties with a Growing Giant: South Africa in India

Catherine Grant Makokera Director

At the end of the World Economic Forum annual meeting in Davis, President Cyril Ramaphosa will be undertaking a state visit to India where he will be accompanied by high-level ministers and a hefty business delegation. Economic diplomacy is a focal point of this important visit, and South Africa’s business community have an opportunity to broaden …
Read more
website twitter linkedin email
Tutwa New Footer