Consumers are in for hard times with middle and lower income groups expected to suffer the most, said Independent economist Dawie Roodt and Brenthurst Wealth Management investment strategist Mike Schüssler on Tuesday. The two predicted upcoming increases sure to put pressure on the already strained consumer.
According to the economists, the rand may slide as low as R11.60 or weaker to the dollar in the near future. This is expected to have a severe impact on everything from the price of food to imported vehicles.
“This country is facing a perfect storm and there seems to be absolutely no will by the government to do anything about it. They have reached the point where they can’t even guarantee loans for parastatals like Eskom because the fiscus is broke,” said Schüssler.
Schüssler also predicted a whopping fuel increase of around 20 cents a litre next month. This will result in virtually all commodities including essentials like food increasing substantially.
Meanwhile, Roodt predicted that there would be an increase in VAT in the near term and other forms of taxation like capital gains tax will be expanded.
CEO of one of South Africa’s largest debt management firms in South Africa Debt Rescue, Neil Roets said the increases would have dire consequences for consumers who are already R1.44 trillion in debt.