‘SA should worry about impact of too slow global growth"

There is reason to worry about too slow global growth at present and the unknown side effects once policy stimulus is withdrawn, says FNB consulting economist Cees Bruggemans. And he believes this is especially relevant for open, domestically underperforming countries such as South Africa. “There is a global unease which is yet to be fully answered,” says Bruggemans. “Growth has faltered seasonally every year since leaving the 2009 recession, but the momentum loss this year seems to be even more disconcerting than before. “Global markets sold off decidedly this April. And while Chinese growth disappointed only marginally, as SARB Governor Marcus noted, the reaction was outsized,” he said. “It coincided with poorer US numbers and indications that the European recession was playing out more deeply and for longer than advertised, with deep suspicions remaining that Japan will not quite succeed in resurrecting its growth performance.” And beyond the many rich country problems, there is a whole gaggle of EM economies struggling to regain speed – Brazil, India and South Africa foremost among them, he added. Bruggemans points out that despite record policy intervention by central banks, the global growth pace does not seem to be responding. “If anything, growth momentum may still be slipping at decimal point level, mainly in Europe and throughout EM space.”