Economists and political analysts say they fear the massive mountain of debt awaiting South Africa and the world at the end of the Covid-19 pandemic.
“Debt is at record highs worldwide. I think it will eventually start an inflationary process,” said Dawie Roodt, an economist with the Efficient Group.
“Some say the only way out is to go cap in hand to the IMF, but they forget there is no such thing as a free lunch in politics. If we go to the IMF, their help will come with conditions such as the reduction of government expenditure, say for instance on social grant payments. “Nevertheless there will have to be serious discussions on the way forward. There has been some mention of a debt write-off, but it remains to be seen whether this will come to be. I’m inclined to think that there will not be punitive conditions attached to whatever debts we incur as the situation is not peculiar to South Africa.”
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