What will 2016 bring for SA?

groceries.jpg INDEPENDENT MEDIA Food prices and the inflation rate are expected to increase this year due to the recent drought

Durban - It’s the question on everyone’s lips at the moment: What will the year ahead bring for South Africa?

Economists are warning that people should brace themselves for a tough year with higher taxes and an increased inflation rate caused mainly by the drought.

Professor of economics Jannie Rossouw said the country would have as low a growth rate as it did last year.

“We expect increases in tax rates to be announced in February. Consumers should prepare themselves for higher tax rates during the period ahead. It will be tougher than 2015. Added to this, there is bound to be an increase in inflation because of the drought,” he said.

Fanie Brink, an independent agricultural economist, agreed, saying the drought would be the cause of economic disaster.

“The present drought in the summer rainfall region of South Africa can easily be worse than the previous severe drought of 1991/92,” he said.

Areas affected were unlikely to get any relief until the end of March.

Professor Mary Scholes, of the Wits School of Animal, Plant and Environmental Sciences, pointed out that because the El Niño system would continue to dominate weather patterns, southern and east Africa would continue to have high temperatures.

“We might get late summer rainfall after March. The severity of the storms, when we do get a rainfall event, might be a high-intensity hail event with low-intensity rain.”

The knock-on effect of the drought would start being felt from February, when food prices would start to soar.

“Usually they would harvest maize in January, late February, so we will know what the yields are by February or March, then there will be a knock-on effect for at least another six months.”

Scholes also foresees more people being likely to move to solar geysers and lighting.

“I think the renewable energy market will pick up in the next six months,” she said.

On the political front we are sure to see a lot happening. Nomboniso Gasa, a political analyst, said the political year ahead was going to be complex because of the local government elections.

“It is not going to be a normal year. Everything that is said and done on a political level is going to be informed by the elections, and all actions by political parties will be done to win the minds and confidence of the electorate.”

Another sector to watch in 2016 will be education. It will start with the release of the matric results. The pass rate is expected to fall, according to quality assurer Umalusi.

The Mercury

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