Browsing: Financial Sector Assessment Program (FSAP)

Power outages, commodity prices erode South Africa’s Q1 growth

Economic Growth
  • Experts warn South Africa’s growth is too low to create enough jobs to absorb new workers entering the labor market.
  • The country’s fiscal position is projected to deteriorate due to weakening mineral revenue. Utility Eskom’s debt bailout, wage bill, and rising debt pile more pressure.
  • As a result, public debt is not expected to stabilise. And headline inflation will return to the midpoint of the target range by end 2024.

South Africa’s real GDP growth is projected at 0.1 percent in 2023, reflecting a significant increase in the intensity of power outages, and weaker commodity prices and external environment.

According to the International Monetary Fund (IMF), annual growth is expected at about 1.5 per cent over the medium term. The country is under vice-like grip of long-standing structural impediments.

South Africa’s power outage woes

For instance, South Africa is struggling with product and labor market rigidities. It …