‘Still a long road out of the recession – Ramos

The South African recession may be over, but there is still a long road to go before the country can claim to be completely free of the aftereffects, said Maria Ramos, group chief executive of the Absa Group and a member of the executive committee of Barclays PLC. Delivering the final lecture in the 2009 Wits Graduate School of Public and Development Management public lecture series last week, Ramos said the human cost of the recession, which is costing the world trillions of dollars, had been extremely high, especially in South Africa where further unemployment can hardly be afforded. “Long after the stock markets have recovered, we will continue to see the real economy, particularly when it comes to jobs, lag behind. Across the world millions of jobs have been lost, and rising unemployment in our own country continues to be a challenge.” Speaking about the global financial crisis and its impact on the world, Ramos said as poverty in developing countries increased, it was imperative for South Africa to achieve economic stability and growth. “We did not have a Great Depression, but there is no doubt that this crisis was very deep, and that there is still a long road out of this recession. The G20 have announced some tough new regulations in an effort to prevent another global crisis. This, of course, includes some new financial regulations that will ensure that a reckless few can no longer put the global financial system at risk.” But, said Ramos, it is imperative that the details of these new regulations such as the specifics of what capital banks must hold be determined sooner rather than later. “The devil is often in the detail and we need to know where we are heading in the future. In South Africa we have taken a number of measures – not just those from the G20 – that have impacted positively, like the National Credit Act, which with 20-20 hindsight of course prevented South Africans from falling deeper into debt. But we are still highly in debt. More than 130 000 South Africans are still receiving debt counselling.” Ramos said while there were far more questions and challenges facing not just South Africa but the world at present, the best insurance against any crisis of this nature was to build a strong economy with robust institutions. “We don’t have answers for all the challenges right now, but there are also opportunities which we should be embracing.”