Economist and senior lecturer at the University of the Free State (UFS), Dr Arno van Niekerk, believes the expected fuel price drop in September will go a long way as far as people’s budgets are concerned. He states that the estimated price by which it will drop is around R2 for petrol and a little over R1 for diesel.

One of the things he believes will be significantly impacted, is inflation, as the fuel price does not only impact motorists, it also has a knock-on effect on the entire economy. “It is not just motorists paying more, it is also the impact of cost on production, from farming to transport to different sectors in the economy,” he adds.

The expected decrease will also result in slower increases in inflation and prices of products increasing at a slower rate.

ALSO READ: #OFMBusinessHour: Shutdown places pressure on strained SA economy

The nationwide shutdown by the Congress of South African Trade Unions (Cosatu) has also been labelled as “putting pressure on the already strained economy” by the senior lecturer in Economics and Finance at the UFS, Dr Sevias Guvuriro.

His view comes after Cosatu and the South African Federation of Trade Unions (Saftu) had their shutdown, with six cities and provinces partaking in the demonstration against the rising costs of living, unemployment, crime, power cuts, and the country’s struggling economy. Guvuriro previously said some of the businesses in towns where the shutdowns took place, closed down out of fear of being vandalised, resulting in the economy taking a knock. Now, the businesses will have to work twice as hard to recover the money lost on Wednesday.

He shared that although he understands the reason behind the shutdown, it has come at a difficult time, while the economy is still trying to recover from the Covid-19 pandemic and also trying to survive the impact that Russia’s war in Ukraine has had on the global economy. For the government to change the way business is approached in the public sector, Guvuriro believes a lot of things will have to be taken into consideration but change is possible.

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