Structural reforms needed to lift growth, says Lesetja Kganyago

No amount of monetary policy action can lift SA’s economic performance if structural impediments such as poor electricity supply are not dealt with, Reserve Bank governor Lesetja Kganyago says.

The Bank, which has had to fend off criticism that it could have done more to safeguard the economy since the outbreak of Covid-19, despite cutting its main interest rate to the lowest level in about half a century, can do very little about the factors that have held SA back over the past decade, Kganyago told Tim Modise on Business Day TV’s current affairs show, Political Currency.

Even as the economy made a tentative recovery after the national lockdown was eased in July, Eskom was still unable to keep the lights on, he noted. The economy was hit with power cuts, despite the lockdown ceasing activity across the board since March, with GDP contracting 51% in the second quarter on an annualised basis.

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