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Speaker 1: Well, we look at the current state of our economy

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Speaker 1: and hope against hope that somehow oil prices come down,

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Speaker 1: or the Middle East conflict eases and we get a

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Speaker 1: chance to start growing again. The release today of a

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Speaker 1: series of scenarios that look at what could happen, the

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Speaker 1: sort of three likelihoods for our economy. They come from

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Speaker 1: the Bureau for Economic Research. They paint three different pictures.

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Speaker 1: One's called the Marabou stork, an undertaker bird. I think

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Speaker 1: you know what that means. The hardyed oar scenario, in

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Speaker 1: which we muddle through, and the African fish eagle, in

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Speaker 1: which we obviously have sustained growth. Senior Economist to the

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Speaker 1: Bureau for Economic Research, doctor Roy Harveman joins me. Now, Roy,

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Speaker 1: good evening, and thanks for your time. Let's do the

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Speaker 1: worst scenario first. Please, what happens in your Marabou stork scenario?

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Speaker 2: Yeah, thank you, and good evening, Stephen, Good evening to

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Speaker 2: your listeners. The Marraboo stalk is pretty much returned to

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Speaker 2: our guess what they captures, and we describe the Maraboo

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Speaker 2: economy as one that scavengers on hope and buries growth.

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Speaker 2: It really failed to reform, it lacks in decline, we

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Speaker 2: see bad spending again, so for example, an increase in

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Speaker 2: spending on unproductive tripity utilities, and poor decisions when it

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Speaker 2: comes to tax policy and overall policy environment, and obviously

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Speaker 2: a return to the days of corruption. So in a way,

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Speaker 2: the Marraboo stalk is going back a few years to

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Speaker 2: the state capture the.

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Speaker 1: Hardy do We sort of muddle through. I mean, look

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Speaker 1: at the hardy doar. So we probably throw a stone

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Speaker 1: or two at the thing. But when we muddle through,

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Speaker 1: what does that do to our economy? Does much really

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Speaker 1: change at all?

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Speaker 2: Yes, well, somebody actually messaged me and said, oh, they're

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Speaker 2: quite offended because they rather lack hardy dots. I think

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Speaker 2: it's about the only person I know that lacks the

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Speaker 2: hardy dot. Most of us have a very love hate

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Speaker 2: relation for the hard perhaps much like we have a

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Speaker 2: bit of a love hate relationship for the South African economy.

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Speaker 2: At the moment. You know, it is growing, but it's

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Speaker 2: not growing particular really fast. It's twice as fast as

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Speaker 2: last year, but it's still not fast enough to get

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Speaker 2: us going. The hardy dot, as we all know, is

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Speaker 2: a big bird that muddles along and squawks and flaps

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Speaker 2: and pretends to be doing things, but it isn't really

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Speaker 2: making much of a difference. And that's sort of our guess.

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Speaker 2: Where we are at the moment is that we are

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Speaker 2: struggling to take flights. The economy is muddling along. We're

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Speaker 2: not creating jobs at the race that we would like

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Speaker 2: to create. There are reforms, but the reforms are taking

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Speaker 2: a little bit of a while to come through. But

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Speaker 2: there are signs of hope, there are signs of despair,

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Speaker 2: but overall we're just kind of muddling along and flapping

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Speaker 2: our wings.

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Speaker 1: And hoping to The African fish eagle scenario talks about

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Speaker 1: three percent growth, a three percent pudget deficit, and three

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Speaker 1: percent inflation all in the next three years. I presume

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Speaker 1: quite a lot would have to happen to make that work.

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Speaker 2: Yeah, it's quite like it'd have to happen. We set

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Speaker 2: ten things that we think are really great in terms

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Speaker 2: of getting that to happen, and that would be in

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Speaker 2: addition to I think the things that are happening at

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Speaker 2: a moment in terms of operation. But in later what

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Speaker 2: I find really interesting about the ten things that we

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Speaker 2: did is that We did this work based on texts

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Speaker 2: we got from our surveys. You know, we run a

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Speaker 2: business confidence index and a consumer confidence index, and then

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Speaker 2: we had two very big sessions with leading CEOs, senior

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Speaker 2: civil servants and academics and general business people on the economy.

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Speaker 2: And that came out as having the same results as

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Speaker 2: a Social Research fundation from correct survey which asked ordinary

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Speaker 2: sile aflicants. And it was really interesting that it turned

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Speaker 2: around crime and corruption and what is the government doing

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Speaker 2: about crime and corruption? And so we decided to put

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Speaker 2: that as our number one big intervention for getting the

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Speaker 2: economy moving again.

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Speaker 1: I mean part of that would be removing the National

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Speaker 1: Police Commissioner who currently faces criminal charges. What do you

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Speaker 1: say needs to happen to get us to the fish

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Speaker 1: eagle scenario? Is it a political possibility?

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Speaker 2: Is it?

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Speaker 1: I mean sometimes with economics you sort of have potential

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Speaker 1: growth and potential potential and things like that. Could we

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Speaker 1: actually do that in three is if we really rarely

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Speaker 1: put our minds to it.

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Speaker 2: Yes, I think so. It is a little bit on

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Speaker 2: our hopeful side. A lot of people ask, well, whylence

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Speaker 2: we aim for five percent? You know, we said, well,

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Speaker 2: maybe not five percent. Maybe let's trial rather trial for

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Speaker 2: three percent and then really apply our minds to get

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Speaker 2: it done. A lot of it is a confident shock,

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Speaker 2: and you know, I think, as you said, the crime

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Speaker 2: and corruption thing is, you know, one of our first

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Speaker 2: things is simply to do things that we are trying

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Speaker 2: to do already, which is to implement Zonder and with

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Speaker 2: longer Commission recommendations, make the National Prosecuting Authority institutionally independent.

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Speaker 2: Sort of issues there with independence and how they function,

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Speaker 2: support the revenue services, push on the elicit economy, and

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Speaker 2: those are sort of very practical things that are sort

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Speaker 2: of are in train, but are taking a bit longer

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Speaker 2: than I think we all would hope, and that will

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Speaker 2: give a bit of a boost of the confidence. Perhaps

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Speaker 2: by the end of twenty thirty we could see those

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Speaker 2: three percent numbers starting to start appearing.

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Speaker 1: Is it really all about I mean to just I mean,

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Speaker 1: I realize you've given us a summary of the scenarios

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Speaker 1: and there'll be a lot more to it, But just

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Speaker 1: to listen to you now, Roy makes it seem like

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Speaker 1: it's really just all about government. I mean, yes, of course,

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Speaker 1: so the biggest actor in the economy. But it really

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Speaker 1: seems there's actually government that this rests there.

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Speaker 2: Yes, I mean, I think what we're making the argument

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Speaker 2: is that you know, we've come out a long term

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Speaker 2: of very poor governance, and actually getting that governance system

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Speaker 2: right again will help us a lot. And it's really

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Speaker 2: interesting if we go back into the GDP figures and

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Speaker 2: you actually take yourself back to even the late twenty tens,

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Speaker 2: we were growing at three percent. You know, we weren't

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Speaker 2: a post World Cup. There was a little a bump,

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Speaker 2: but then we sort of good about three percent after that,

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Speaker 2: and then as the governance issues started, it's coming in

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Speaker 2: the deterioration of the economy. One of the most interesting

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Speaker 2: things about that is where the money goes. So when

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Speaker 2: you raise a round of taxes, how does the government

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Speaker 2: spend that money. When the government spends that money on

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Speaker 2: madup casillia, that money is basically just lost to all

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Speaker 2: of us. But if the government, for example, spends that

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Speaker 2: money on you roads, or gets our ports to work,

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Speaker 2: or improves the transmission line, then that actually crowds in

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Speaker 2: a lot of other money. So I think that it's

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Speaker 2: possible for us to get back to that sort of

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Speaker 2: twenty fifteen era, maybe even twenty twelve, where things were

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Speaker 2: actually better than they are at the moment. Not amazing,

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Speaker 2: but much better than they are amazing. I mean this

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Speaker 2: is not an over the ambitious scenario I think.

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Speaker 1: Doctor Roy Harrman, thanks very much. Indeed, I'll give your

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Speaker 1: love to every hearty diar I see. Doctor Roy Harveman

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Speaker 1: is an economists of the Bureau for Economic Research. Twenty

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Speaker 1: six minutes after six