The World Bank has cut South Africa’s growth projections for 2017 in half, bringing it in line with the low expectations of economists and the South African government itself.<\/p>\n
In a statement on Tuesday (19 September) the global banking group reduced South Africa’s growth prospects to 0.6%, from a forecast of 1.1% at the start of the year.<\/p>\n
The growth forecast from the South African government was also greatly reduced in August, when president Jacob Zuma said that growth was likely to be around 0.5% in 2017, down from ‘rosier’ ambitions of 1.3% earlier in the year.<\/p>\n
The World Bank warned that\u00a0any prospect of recovery in would \u201cremain fragile\u201d unless South Africa succeeds in becoming more productive.<\/p>\n
Since the end of the 2009 global economic recession, South Africa has consistently missed its growth targets of 5%. The government has repeatedly blamed adverse global economic conditions for this failure.<\/p>\n
However, current global conditions are again favouring emerging markets, but investors remain bearish on South Africa in particular over its adverse political climate.<\/p>\n
Policy uncertainty; growing political instability; high levels of unemployment; extreme inequality; and poverty all mire the country’s ability to be productive and grow, analysts have said.<\/p>\n
Speaking to Reuters,\u00a0World Bank southern Africa specialist Sebastian Deussus said that\u00a0South Africa is not benefiting from the global economic rebound, despite being well-placed in exports markets.<\/p>\n
“But we don\u2019t see the country\u2019s exports breaking into new markets,” he said.<\/p>\n
Economists’ predictions for growth in 2017 now range between as little as 0.2% to 0.7%. The country’s economy grew at 0.3% in 2016.<\/p>\n