'Expect a challenging year ahead'

Global economy heads for slowdown ED RICHARDSON NEXT YEAR will present a number of challenges to economic growth, according to the Bureau of Economic Research (BER). Looking at economic prospects for the fourth quarter of 2006, the BER says the current buoyancy being experienced in the economy indicated a “more challenging growth environment unfolding”. Added to this are indications that the global economy is heading for a slowdown. “Domestically there are leading indications that the interest rate increases are starting to impact. The favourable pricing environment of recent years is also rapidly changing and financial volatility has reared its ugly head,” according to the report. Growth in the SA economy will be spurred by exports rather than the domestic market. Other contributors to the country’s growth should also come from sustained fixed investment and the subsequent employment growth. The BER expects growth to be in the region of 4.1% in 2007.