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SA’s economy to grow 0.6% in 2017 – World Bank

Sub-Saharan Africa to grow at a slower rate this year.

Economic growth in sub-Saharan Africa is expected to be 2.4% in 2017, the World Bank said on Wednesday, down from the 2.6% projected in April.

It said the downgrade was due to a number of reasons, including Nigeria’s failure to meet expectations but also broader conditions.

“Regional per capita output growth is forecast to be negative for the second consecutive year, while investment growth remains low, and productivity growth is falling,” it said.

Growth across the region, however, was seen rising 3.2% in 2018 and 3.5% in 2019, forecasts unchanged from earlier this year. 

In its latest Africa Pulse report, the bank said the region would be helped by better commodity prices. Sub-Saharan African economies have been hit by lower commodity prices which slowed growth in the last few years, cutting government revenues.

Albert Zeufack, World Bank chief economist for Africa, said the region’s growth recovery would partly be driven by the continent’s two largest economies – Nigeria and South Africa – exiting recession.

He said the two countries need “deeper reforms” to get back to pre-2014 levels of growth and their political uncertainty needs to be reined in. He said they make up about half of Sub-Saharan Africa’s GDP growth.

The World Bank said Nigeria’s economy, the largest in the continent, was expected to expand by 1% in 2017.

South Africa’s economy, hit by political worries, was expected to grow just 0.6% this year. 

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Government and others must realize that it will be very difficult to get consumer spending accelerating in South Africa while ordinary citizens must pay twice (via taxes and then via discretionary spending) for items like security and medical treatment. If we did not have to pay for private security – because the SAPS is inept – then there is more money for consumer spending. If we did not have to pay exorbitant increments every year for electricity to a corrupt SOE there will extra money for spending and investment and so and so on. Previous Anglos CEO Cynthia Carroll CEO said it best when she said that the South Africa Government cannot bypass economic realities. She also said that there is no society without law and order. Yet the President of the county flouts these basic principles and gets away with it. These are the people we need to listen to instead of the ‘hot air’ from those who have created nothing (like the Zumas and Malemas of the world).

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