{"id":793730,"date":"2024-10-04T08:38:41","date_gmt":"2024-10-04T06:38:41","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=793730"},"modified":"2024-10-04T08:38:57","modified_gmt":"2024-10-04T06:38:57","slug":"south-africa-could-be-setting-itself-up-to-fail","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/793730\/south-africa-could-be-setting-itself-up-to-fail\/","title":{"rendered":"South Africa could be setting itself up to fail"},"content":{"rendered":"\n<p>South Africa is expected to see economic growth in 2025, but top government and business officials may be too optimistic about what is achievable.<\/p>\n\n\n\n<p>Earlier this week, the Bureau for Economic Research (BER) announced the launch of the&nbsp;Impumelelo Economic Growth Lab, an independent hub for analytical research capacity to support economic reform.<\/p>\n\n\n\n<p>The BER said that the four areas that would bring the most significant gains in the shortest time are: <\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Electricity reforms <\/strong>\u2013 Sustain the reduction in load-shedding by maintaining momentum on the electricity programme<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Ports and rail reforms<\/strong> \u2013 Increase export volumes, particularly for industries that are job creators (agriculture and mining)<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Water<\/strong> \u2013 Improve service delivery would increase business confidence and encourage investment<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Crime, corruption, governance<\/strong><span style=\"box-sizing: border-box; margin: 0px; padding: 0px;\"><strong>, and other reforms\u2014<\/strong>Improve business confidence by removing the grey list, finalising visa reforms, and improving<\/span> local government governance. <\/li>\n<\/ul>\n\n\n\n<p>The researchers believe that the fast-tracking reforms in these areas will lead to <strong>GDP<\/strong> <strong>growth of over 3% by 2025. <\/strong><\/p>\n\n\n\n<p>This would easily surpass the growth figures of 0.7% in 2023 and an expected 1.0% in 2024. <\/p>\n\n\n\n<p>It would also ensure real growth as population growth, which averages about 1.5% every year, is currently outpacing economic growth.<\/p>\n\n\n\n<p>&#8220;This adds to last week\u2019s relatively encouraging news about SA\u2019s economic growth prospects and potential for attracting (foreign) capital,&#8221; said the BER. <\/p>\n\n\n\n<p>&#8220;The news from Home Affairs that it would reform the current strict visa system is also welcome in that regard.&#8221; <\/p>\n\n\n\n<p>The over 3% growth figure was announced at the launch of <a href=\"https:\/\/businesstech.co.za\/news\/government\/793246\/the-big-plan-to-grow-south-africas-economy-by-at-least-3\/\">Phase 2 of the Government Business Partnership earlier this week<\/a>, which was attended by President Cyril Ramaphosa, Ministers, and many of South Africa\u2019s top CEOs. <\/p>\n\n\n\n<p>Phase 2 of the partnership seeks to increase resources sent to the electricity and logistics sector and a clear set of actions to contribute to more rapid economic growth.<\/p>\n\n\n\n<p>&#8220;The collaborative efforts of this partnership and the progress we have made so far are well aligned with the priorities of the Government of National Unit,&#8221; said Ramaphosa. <span style=\"color: rgb(33, 37, 41); font-family: lato, Arial, sans-serif; font-size: 1.1rem; white-space-collapse: collapse;\"><\/span><\/p>\n\n\n\n<p>\u201cTogether, we are advancing our bold ambition to move South Africa forward. We are witnessing renewed investor confidence, which speaks to the success of our approach.<\/p>\n\n\n\n<p>\u201cWith a more focused and determined effort, Phase 2 will continue to tackle key challenges and contribute to momentum on transformation, economic recovery and long-term prosperity.&#8221; <\/p>\n\n\n\n<p>That said, it is worth noting that <strong>the forecast for over 3%<\/strong> <strong>is not the BER&#8217;s baseline view. <\/strong>While theoretically attainable, it would require a laser focus on the identified issues.<\/p>\n\n\n\n<p>&#8220;Without swift action, any delays will diminish the odds of attaining 3% growth,&#8221; said the BER. <\/p>\n\n\n\n<p>The BER previously said that it expects GDP growth of 2.2% in 2025, which is already quite optimistic compared to other analysts and economists. <\/p>\n\n\n\n<p>Investec believes GDP growth will reach 1.7% in 2025, while the IMF believes it will only hit 1.3%. <\/p>\n\n\n\n<p> Investec is, however, optimistic about South Africa\u2019s medium-term prospects, with growth of 3.1% expected for 2029. <\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-businesstech wp-block-embed-businesstech\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"PpunfefG0M\"><a href=\"https:\/\/businesstech.co.za\/news\/business-opinion\/792886\/south-africans-should-get-richer-over-the-next-five-years-2\/\">South Africans should get &#8216;richer&#8217; over the next five years<\/a><\/blockquote><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;South Africans should get &#8216;richer&#8217; over the next five years&#8221; &#8212; BusinessTech\" src=\"https:\/\/businesstech.co.za\/news\/business-opinion\/792886\/south-africans-should-get-richer-over-the-next-five-years-2\/embed\/#?secret=RRYFuVM18z#?secret=PpunfefG0M\" data-secret=\"PpunfefG0M\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p><a href=\"https:\/\/businesstech.co.za\/news\/finance\/793444\/south-africa-isnt-out-of-the-woods-yet-top-ceos-warn\/\">Speaking the day after Phase 2 was launched<\/a>, Sanlam CEO Paul Hanratty warned that the country should be cautious about becoming complacent and thinking its major structural issues have been solved.<\/p>\n\n\n\n<p>Despite no load shedding for over six months, the electricity crisis is far from over. Eskom also needs to build generation capacity to deal with an increase in demand.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p><strong>Read<\/strong>: <a href=\"https:\/\/businesstech.co.za\/news\/lifestyle\/793107\/america-is-hunting-for-south-africans-with-these-skills-paying-up-to-r2-5-million\/\">America is tapping skilled South Africans to fill these 12 jobs \u2013 paying up to R2.5 million<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>South Africa needs to address four major issues to ensure strong economic growth, but this would require intense focus. <\/p>\n","protected":false},"author":95,"featured_media":793265,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[14829,26],"class_list":["post-793730","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-ber","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/793730","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=793730"}],"version-history":[{"count":5,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/793730\/revisions"}],"predecessor-version":[{"id":793757,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/793730\/revisions\/793757"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/793265"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=793730"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=793730"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=793730"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}