HSRC

Rethinking South Africa's macroeconomic policy approach CATEGORY: Latest News AUTHOR: Andrea Teagle We are in a historical time of momentous changes in macroeconomic thinking that have been driven by the need to respond to crises, said macroeconomics expert Dr Seeraj Mohamed, while speaking at the first of a series of Macroeconomic Policy Dialogues hosted by the Human Sciences Research Council. Mohamed and fellow economists Gilad Isaacs and Alexis Habiyaremye argued that fiscal stimulation is a critical and underutilised tool for overcoming and preventing socioeconomic crises like that precipitated by the COVID-19 pandemic. By Andrea Teagle Despite the global shift away from neoliberal macroeconomics, South Africa is still anchored in neoliberal economic thought, favouring macroeconomic stabilisation, fiscal austerity and minimal state intervention. This ‘old view’ is encapsulated by the Washington Consensus, according to macroeconomics expert Seeraj Mohamed. The agreement reflected a ‘one-size-fits all’ set of free-market policy reforms that the World Bank and the International Monetary Fund (IMF) promoted across developing countries in the 1980s.