The Reserve Bank has downgraded its forecast of South African GDP growth to just 0.7% this year. In the third quarter of 2022 (the most recent GDP data available) growth was 1.6%. This means that economic growth is barely keeping pace with population growth and incomes per capita are stagnating. Why is economic growth so weak? What policies are available to government and the Reserve Bank to encourage faster growth in the short- term? In answering this question, you should look at: 1. Theory: What possibilities does the theory suggest might lead to slow and falling GDP growth? For this look at Y=C+I+G+X-Z. Why might these components of GDP be growing only slowly? 2. Evidence: You have identied possible reasons for slow growth from the theory. Now what is actually happening? For this you can look at quarterly GDP statistics published by the Reserve Bank. Which components are in fact growing slowly? {You should sue especially the Table National accounts (Quarter-to-quarter percentage changes in selected seasonally adjusted not annualised data at constant 2015 prices) on page 8-160 in the SA Reserve Bank Quarterly Bulletin see link below for this analysis). 3. Whv? Having identied from the statistics which components are growing slowly we now want to explain why this may be the case. What did the theory tell you might lead to slow growth of C, I, G or X, or a big increase in Z (negative for GDP growth). Which of these factors has in fact in behaved in the negative fashion theory expects? 4. What? What can government (G &T) or the SA Reserve Bank (I) do to boost growth in the short-term? Why have they not already done this