The International Monetary Fund (IMF) expects South Africa’s economy to grow by 5% in 2021, reflecting a better-than-expected growth in the year’s first half.<\/p>\n
In its latest regional outlook for the Sub-Sahara region published on Thursday (21 October), the group warned that this growth could slow significantly in 2022 due to ongoing local issues.<\/p>\n
“The outlook has been weighed down by the combined impacts of the third wave of Covid-19 and localized social unrest in July,” the group said.<\/p>\n
“With the pace of structural reforms expected to remain limited and the faster-than-expected rebound in 2021, South Africa will be constrained in its ability to sustain the 2021 growth pace, so growth is expected to slow to 2.2% in 2022.”<\/p>\n
The IMF has also warned that the entire Sub-Saharan region faces the prospect of repeated Covid-19 waves before vaccines become widely available.<\/p>\n
The baseline assumes that localized lockdowns will accompany further outbreaks but that containment measures will generally be less stringent than they were in early 2020, it said.<\/p>\n
“Each wave is different, however, with potentially different variants and different containment requirements. By the same token, households and firms have all shifted their behaviour over the past 1 and a half years, adapting as needed.<\/p>\n
“Therefore, the impact of future waves on activity remains highly uncertain<\/strong>.”<\/p>\n The IMF said that this uncertainty would persist for as long as the region remains unvaccinated.<\/p>\n