The effect of Euro zone crisis on the South African economy

Done by The Oprah Winfrey Leadership Academy for Girls South Africa

overviewSouth Africa(SA) is not totally exposed to the euro zone

crisis. For example only 0.4 % of our banking system is exposed to European countries such as Portugal, Ireland, Greece and Spain this has been the reason why the crisis has not affected us that much yet.

However the crisis will be a major threat in the long run. The EU is South Africa’s largest trading partner

accounting for 22% of our country’s total exports which is valued at over €22 billion per year. Since we have strong trade links with the EU South African companies with large operations in the euro zone such as Old Mutual, Mondi and Sappi could experience a collapse and a loss. The consequences of this will be a job losses for ordinary South Africans who work for the above companies resulting in an increase in our unemployment rate.

Other risks for South AfricaThe South African motor industry will be

negatively affect by the EU crisis since they export Most of their products there. Here is an article that touches into this issue: http://www.businessday.co.za/articles/Content.aspx?id=155184

Our Currency (Rand) has not been stable for a while and due to this issue it will weaken further thus resulting in the following.An Increase in Inflation.An increase in Exchange rates

The effects of the Crisis on Education In SAAs the Euro zone financial crisis does not affect us

directly the should not be a massive fall out for education.

However, as indicated that the indirect impact on SA will be job losses and inflation, the situation will affect poorer communities more.

Transport to school as well as food and stationery will become more problematic for poor people.

Schools already provide feeding schemes that are financed by Education Departments across the 9 provinces of South Africa.

The effects of the Crisis on Education In SA cont.Government also provide for no fee schools .

These are schools that provide education free of charge and no school fees may be collected from parents in such schools.

In these schools all the stationery and textbook are provided by the state and in many such schools you will also find feeding schemes.

The government has just completed a audit of education programmes and will roll out an updated National Curriculum Statement in grades 1 and 10

Projects for the future.There are a wide variety of projects to

enhance delivery of education to the future of the country.

Some of these are government interventions in schools that are under performing.

These include teacher’s training and winter and spring schools where already taught work can be revised, reviewed and consolidated.

There are also numerous programmes that are made possible by private sector donations.

ReferencesThe effect of the euro zone crisis on South Afr

ica. Available online: http://www.getsmarter.co.za/blog-business/807-economics-euro-zone-crisis-puts-sa-business-in-jeopardy

http://www.businessday.co.za/articles/Content.aspx?id=155184

Google imageshttp://ec.europa.eu/economy_finance/publicat

ions/publication15398_en.pdf