There is no doubt that addressing this must be the national policy priority. South Africa’s unemployment is of a structural nature, and not something that can be solved by interest rates or the exchange rate alone.
As we have noted on numerous occasions, interest rates can have a cyclical effect on growth or employment, but on their own will not be able to solve an inherently structural problem. It is incorrect to look at the interest rate or the exchange rate as the silver bullet that will solve the country’s growth problems.