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SA’s economy to grow to 1.3% in 2019 – World Bank

The implementation of structural reforms may boost economy.

The World bank forecast higher South African economic growth this year compared with the previous year, but warned of risks such as global trade tensions and poor balance sheets of state-owned companies.

The World Bank sees South Africa‘s gross domestic product growing by 1.3% this year, an improvement from a forecast of 0.9% for 2018.

Economic growth would be supported by the implementation of structural reforms under President Cyril Ramaphosa such as relaxed visa regulations, the establishment of an infrastructure fund and progress on the Mining Charter, the bank said.

In its latest economic update report, the bank projected South Africa‘s economic growth at 1.7% in 2020.

“We believe the reforms are going into the right direction but first they have to be implemented. Implementation is key,” Sebastien Dessus, the World Bank’s programme leader for South Africa told a news conference in Johannesburg.

The Bank, however, said South Africa faced risks such as El Nino weather conditions that could impact crop production, global trade tensions and the impact of cash-strapped state-owned enterprises like power utility Eskom on the national budget.

“An economy like the one in South Africa cannot afford to have Eskom as a failed entity. What government has to do is to work with the management and leadership of Eskom to figure out the way forward,” said Paul Noumba Um, the World Bank’s country director for South Africa.

“The way forward entails different kind of interventions. There is a debt restructuring dimension and at the same time the company itself has to become more efficient.”

Eskom is facing a severe financial crisis and Ramaphosa has appointed a team to, among other things, look into Eskom’s business and funding model and how the power utility should be structured. 

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Absolutely! And the moon is actually a big piece of cheesecake inhabited by three-legged fairies.

A bit like SA’s ‘formal’ unemployment figure – it is completely fake. The real unemployment rate in SA is more than seventy percent (minus all the fake “jobs”).

SA’s economy is shrinking – fast. If I quotes figures here, my post gets blocked, so I won’t bother; but look it up for yourself.

Eg – start with SA’s GDP per capita history, but not the ‘official’ internet gobbeldygoo (or is that Google-dygoo) that gives it at the current exchange rate (over time – how daft) – but adjust it for the value of the currency at the time.

You will realize that SA’s economy is today around one third of the size it was, in 1978, for the size of its population. In short: SA’s economic wealth has collapsed around two thirds since 16 June 1976.

Imagine what your children and theirs will have in thirty, to forty years time, when they have to provide for theirs?

End of comments.

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