South Africa: New leadership brings new optimism

Can President Ramaphosa make the tough policy decisions needed to spur economic growth?

Time to read: 4 min

Volumes have been written about the scandal-tainted regime of former South African President Jacob Zuma. Since becoming leader of the country in 2009, Zuma was dogged by allegations of corruption, nepotism and poor personal judgement, and national prosecutors recently reinstated corruption charges against him. With his recent resignation and the ascension of new President Cyril Ramaphosa in February, international and domestic sentiment toward the country (and its economy) has improved dramatically. However, South Africa faces significant economic challenges. To reverse the declining trajectory of the economy, I believe a number of tough policy choices are needed:


Why is inflation below target in so many advanced economies?

Exploring the misperceptions and the facts about inflation

Time to read: 3 min

Since the global financial crisis, inflation in the advanced economies has persistently undershot their 2% targets despite unprecedented quantitative easing (QE), extraordinarily low interest rates, large fiscal deficits and near all-time low unemployment.

US Federal Reserve (Fed) officials have explained that the weakness of inflation in 2017 is due to the reduction in the price of mobile-phone data charges. Similar one-off explanations such as commodity price weakness or technology-induced declines in prices have been also used in Japan and the eurozone to explain sub-target inflation. In this article, I will explore two mistaken theories of inflation and explain the true reasons behind inflation’s benign trend.

The misconception of fiscal deficits


Argentina: Will the reforms in place pay off?

The new administration has introduced some sound economic policies, but can the country shake its Peronist past?

Time to read: 4 min

About 100 years ago, Argentina was one of the wealthiest countries in the world by virtue of its fertile land. Its economy thrived by shipping beef and grains around the world. But economic and political turmoil through the 1930s sowed the seeds of populism — the effects of which have lasted decades. With the 2015 election of reformist candidate Mauricio Macri as president, Argentina seems to have the best chance of regaining the prosperity it once enjoyed. Will the populace (and its leaders) have the patience and fortitude to allow market reforms to work? The midterm legislative elections in October will provide a critical test.

The legacy of Juan Peron        

One cannot understand today’s Argentina without explaining the legacy of its most iconic figure, Juan Peron.