Our last article on South Africa suggested that the country was now entering an "endgame" where the culmination of years (even decades some would say) of stagnant growth and a growing structural malaise would lead to an eventual fiscal crisis. Naturally, we did not anticipate the arrival of the COVID-19 pandemic nor its widespread global reach, and equally, neither did we anticipate the draconian and drastic public policy response to the pandemic in many countries including South Africa (NYSE:EZA).
Although South Africa was already headed for a fiscal crisis, the onset of the