Political infighting will lead SA to long-term recession

South Africa is marching headlong towards a recession thanks to poor political leadership and political in-fighting.

That’s the view of Dr Iraj Abidian‚ executive chairman at Pan-African Capital Holdings.

Looking at the unfolding spat between Finance Minister Pravin Gordhan and the Hawks from a global financial and investment community perspective‚ he told CapeTalk radio that there was no coherence or stability in the economy.

“It is totally nonsensical‚ it is totally incoherent and it’s just the antithesis of governance and antithesis of political leadership from whatever angle you look at it‚” he said.

“Political leadership is the key pillar of economic stability and prosperity. Whatever ideologies you have‚ right‚ left‚ centre‚ quite frankly it doesn’t matter. You’ve got to have stability‚ you’ve got to have credibility and every day‚ unfortunately‚ this pillar of our economy in one way or another‚ shows that it’s just got no coherence.”

African National Congress leaders fighting each other and disagreements with its alliance partners were undermining the economy. “It is unheard of that one minister comes and attacks another minister …. That’s the best way to undermine national interest. Quite frankly‚ some of the individuals should be sued for betraying the national interest‚” he said.

Asked if the in-fighting continuing could potentially lead to a recession‚ he said: “Absolutely‚ not potentially‚ we are marching towards recession and we have been for the past three‚ four years.”

He warned that if government’s “nonsensical behaviour” did not stop‚ “rest assured that we will end up the year in negative growth‚ which is recession. We don’t have to speculate on that‚ that’s a for sure outcome of this path of inconsistency and total destabilisation of confidence … in the country.”

He warned that the consequences could be far reaching‚ leading to a long term recession. “Look at what happened in Argentina. It has taken 40 years to recover from some of the similar types of political shenanigans that beset them.”

– TMG Digital