Charting a path for SA's economic renewal

SOUTH Africa's economic landscape faces momentous challenges, as underscored recently by the imposition of US tariffs on South African goods which has exposed the vulnerabilities inherent in the country's economic structure.

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There is an urgent need to rethink industrial policy, diversify trade relationships, and develop robust strategies for resilience. In an era defined by shifting global centres of power and an increasingly multipolar world, South Africa must look outward, drawing inspiration from nations that have had notable successes with industrialisation strategies.

Among the most instructive examples are Indonesia and Malaysia which, over the past 30 years, have demonstrated remarkable growth, significant poverty reduction, and the emergence of robust middle classes.

Their experiences offer South Africa practical, actionable insights as it seeks to overcome its own hurdles, including slow economic growth, high unemployment, deteriorating infrastructure and persistent governance challenges.

Responding to crisis: lessons from the Asian financial crisis of 1997 - 1998

In the late 1990s, the Asian financial crisis swept across the region, testing the mettle of governments and societies alike. The crisis wreaked havoc: currencies plummeted, banking systems teetered on the edge of collapse, and millions were thrust into poverty.

Indonesia's economy contracted by over 13%, while Malaysia slipped into a deep recession, its currency battered by speculative attacks.

The recovery strategies adopted by these nations provide insightful guidance on the power of decisive, and at times, unconventional policy.

Malaysia, braving criticism from orthodox economists, imposed controls to halt capital flight, pegged its exchange rate to the US dollar, reformed its banking sector, and deployed fiscal stimulus to protect jobs and support domestic demand. While these interventions were contentious, their effectiveness became evident as Malaysia's economy stabilised more rapidly than many had anticipated.