Introduction

Since 2007, South African economic growth has weakened and become volatile following a sequence of unexpected global shocks. These began at the onset of the global financial crisis in 2007, continued with the subsequent global recession in 2008 and upon the onset of the euro area sovereign debt crisis and the implementation of unconventional monetary policies. The empirical assessment and quantification of the effects of these adverse shocks emanating from advanced economies is important for both policymakers and researchers. It is necessary for policymakers to understand the nature of these unexpected shocks and disentangle whether the spillover is directly and indirectly transmitted into the South African economy. The various channels have not been explored in detail, and it is the objective of this book to analyse these effects. Is the South African economy vulnerable to external shocks, and if so, in what way? How does the economy respond to these shocks, which manifest themselves as the unexpected changes in global economic growth, global risk perceptions and financial spillovers?