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PRESS RELEASE GOVERNMENT'S ECONOMIC POLICY THE PROBLEM

The economy will not recover as long as the ANC continues with its socialist and communist political and economic systems that destroy economic growth and prosperity. Therefore, a short-term stimulus and recovery package will not make any difference because economic growth is a long-term process that must be based on economic principles, "says independent economist, Fanie Brink.

Brink responded to President Cyril Ramaphosa's announcement of the government's economic package to try and stimulate the extremely bad economy.

The big question, however, is how this package will be financed because there is no room for higher state income and loans to finance the budget deficit which will significantly increase the state's debt burden and plunge the country into a huge financial risk. Greater regulation of the economy and higher government spending will be very detrimental to the economy if it is to be funded by higher taxes.

Unfortunately, the government has long passed the point over which Margaret Thatcher, former British Prime Minister, said that "the problem with socialism is that it eventually runs out of other people's money."

"With its ideology, the ANC government will never understand that economic growth in the world is driven and created by the profit motive based on the principles of a capitalist economic system."

The government's responsibility is to establish an economic policy environment that will make it possible for every industry to make a greater contribution to economic growth by improving their profitability, but the government is engaged in exactly the opposite policy actions which is implemented through greater interference in the market and regulation of the economy.

"Socialism and communism can only destroy economic growth and prosperity which has decades ago been clearly proven and therefore totally rejected worldwide. The total return to a capitalist economic system is the only way how economic growth is being created worldwide, says Brink.

Bothaville

21 September 2018

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