The South African government appears to be acting against its own interests, economists say.
The government’s geopolitical spat with the United States over its apparent support for Russia in its war on Ukraine has not only undermined the country’s reputation but also wreaked havoc in the financial markets, says Nedbank.
As previously highlighted, the summit – expected to host Russian President Vladimir Putin – has put South Africa in an incredibly tight spot. Nedbank said that the potential economic and trade costs of damaging relations with the US would be significant. It could also extend to other US allies. The mining, manufacturing and agricultural sectors are the main beneficiaries of these trade agreements.
When considering all European countries – except Russia – the possible loss climbs to R550.3 billion;In the worst-case scenario, where both the USA and EU withdraw from their respective trade deals, R443 billion worth of exports will be placed on the line, Nedbank said.Adding further to the potential costs, South Africa runs wide twin deficits – current account and budget balance – equivalent to 0.5% and more than 4% of GDP, respectively, Nedbank said.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Reserve Bank warns sanctions over Russia-Ukraine stance could hammer South AfricaEven if the nation isn’t sanctioned, the threat alone could mean the country’s financial institutions are subjected to more intensive scrutiny by their foreign counterparts, said Nicola Brink, the head of the central bank’s financial stability department.
Read more »
South Africa: Gauteng Province Identifies 275 High-Risk Schools - South African News Briefs - May 30, 2023
Read more »
South Africa: Limpopo Province Records First Cholera Case - South African News Briefs - May 31, 2023
Read more »
South Africa: The Two Defining Challenges Facing South AfricaAnalysis - Stagnation at home and fence-sitting abroad are costing the country dearly, and the costs are only rising.
Read more »
Mercedes-Benz launches a South African exclusive – the new V-Class Special EditionMercedes-Benz South Africa has launched a luxuary van that is exclusive only to South Africa.
Read more »
Inside South Korea's race to become one of the world’s biggest arms dealersSouth Korea is using a $13.7 billion arms deal with Poland - Seoul's biggest ever - to lay the groundwork for a military-industrial juggernaut that the two nations' defence companies hope will feed Europe's hunger for weapons far into the future.
Read more »