South Africa's future is gloomy, with growth of only 1.4% over the next three years
While South Africa's GDP is expected to increase by 2.5% in 2022, the forecast has deteriorated to 1.4% growth over the next three years. This was in contrast to the 1.6% forecast in the Long Term Budget Policy Statement for 2022. (MTBPS). Finance Minister Enoch Godongwana discussed the crystal glazing on Wednesday when presenting the
South Africa's future is gloomy, with growth of only 1.4% over the next three years
While South Africa’s GDP is expected to increase by 2.5% in 2022, the forecast has deteriorated to 1.4% growth over the next three years.
This was in contrast to the 1.6% forecast in the Long Term Budget Policy Statement for 2022. (MTBPS).
Finance Minister Enoch Godongwana discussed the crystal glazing on Wednesday when presenting the 2023 Budget Address at Cape Town City Hall.
The Treasury predicts that the Gross Domestic Product (GDP) will expand by a fractional 0.9% in 2023.
“At R4.6 trillion, the size of the economy in 2022 was bigger than the pre-pandemic levels in real terms; evidence of a robust economic recovery even in the face of lingering COVID-19 scarring,” the minister stated.
In this context, he stated executing growth-enhancing changes “is a crucial element of our growth strategy”.
In materials distributed to the media before of the Budget Address, the National Treasury stated that insufficient energy supply remained the most immediate and substantial barrier to production, investment, and employment.
According to the government, this is exacerbated by interruptions and underinvestment in freight and logistics networks, which undermine competitiveness.
“Rising inflation has constrained household spending and raised the cost of living.”
With global economy anticipated to weaken in 2023, the Minister stated that central banks throughout the world were responding to high inflation by raising interest rates.
According to the Budget Review, while headline inflation appears to have peaked in many nations, it remains high.
“A number of global risks remain, implying the need for stronger domestic demand to support economic growth,” it reads.
According to Godongwana, South Africa requires significantly stronger growth to alleviate unemployment and poverty. This, he added, necessitates continuous commitment to a macroeconomic framework that fosters investment, rapid progress on ongoing reforms, and enhanced state competence.
