According to Investec Wealth & Investment International, South Africa\u2019s anaemic economic growth since 2010 has left its population significantly poorer than the global average.<\/p>\n\n\n\n
\u201cYou can see a decoupling of South Africa\u2019s gross domestic product per capita from the rest of the world in 2010,\u201d Osagyefo Mazwai, investment strategist at Investec Wealth & Investment International, which manages 530 billion rand ($30 billion) in assets, said in an interview. <\/p>\n\n\n\n
In 2023, South Africa\u2019s GDP per capita adjusted for purchasing power parity was $15,194, compared with $22,850 globally.<\/p>\n\n\n\n
Growth in Africa\u2019s largest economy has been hampered by sustained power outages, graft, crime, disintegrating infrastructure and foreign-policy missteps. <\/p>\n\n\n\n
Low growth has meant its economy is 37% smaller than it would have been had the country tracked its emerging-market peers.<\/p>\n\n\n\n
The country may have also lost out on R5 trillion in taxes since 2010, which could have boosted its ability to fund services and lower its debt-to-GDP ratio, Investec said. <\/p>\n\n\n\n
For South Africa to return to the global average within the next 10 years, GDP per capita would have to grow at around 8%, Mazwai said. <\/p>\n\n\n\n
That\u2019s above the middle-income average growth rate of 5.9% since 1991 and almost double the global average growth rate of 4.4%, Investec said.<\/p>\n\n\n\n
\u201cYou need to be exceptional in your GDP growth outcomes, and even in that environment, you only get back to the global average,\u201d he said.<\/p>\n\n\n\n
The International Monetary Fund expects the country\u2019s economy to grow 1% in 2025, down from a previous forecast of 1.5%, and Investec sees it expanding by 0.9% before reaching 3% by 2030. <\/p>\n\n\n\n
For South Africa to unlock faster growth, it needs to speed up policy execution to boost business confidence. <\/p>\n\n\n\n
\u201cIf you look throughout the entire period of the post democratic South Africa, periods of lower business confidence coincide with periods of lower economic growth\u201d and gross fixed capital formation, Mazwai said.<\/p>\n\n\n\n
The Bureau for Economic Research data shows that since the financial crisis, business confidence has been below the 50-mark that separates growth from contraction on average, and gross fixed capital formation hasn\u2019t performed much better.<\/p>\n\n\n\n
World Bank data shows that it was just 15% of GDP in 2024, compared with 40% for China, 30% for India, and 22% for Russia. <\/p>\n\n\n\n
\u201cIf you look at India and other markets like that, they\u2019re not happy at 6% growth,\u201d Investec Bank Chief Executive Officer Cumesh Moodliar said in the same interview. <\/p>\n\n\n\n
\u201cWhy should we be hovering at one odd percent growth? It\u2019s because gross fixed capital formation is just not happening at the pace it should,\u201d he said. \u201cWe really need to bring that speed into it and create those efficiencies.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
South Africa\u2019s economic growth since 2010 has left its population significantly poorer than the global average.<\/p>\n","protected":false},"author":59,"featured_media":826180,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9876],"tags":[20767,1498,853],"class_list":["post-830901","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lifestyle","tag-gdp-per-capita","tag-investec","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/830901","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\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=830901"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/830901\/revisions"}],"predecessor-version":[{"id":830906,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/830901\/revisions\/830906"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/826180"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=830901"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=830901"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=830901"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}