IMF worried about impact of SA’s growth outlook on poverty

‘Policy action needs to focus on mitigating the impact of these shocks while addressing longstanding structural economic obstacles to growth.’
Image: Andrew Harrer/Bloomberg

The International Monetary Fund (IMF) said on Tuesday at the end of a visit to South Africa that its staff were increasingly concerned about the country’s economic growth outlook and the implications on employment, poverty and inequality.

Africa’s most industrialised economy has recovered from the Covid-19 pandemic faster than many analysts had predicted, with data on Tuesday showing first-quarter output reached pre-pandemic levels.

But the recovery has been uneven across sectors, and the country is one of the most unequal in the world.

In a statement, the IMF pointed to a series of shocks which it said adversely affected South Africa’s economic trajectory.

“The flooding in Durban, uncertainty about the war in Ukraine, tightening of global financial conditions, and China’s slowdown pose challenges to growth and price stability,” the IMF said.

“Policy action needs to focus on mitigating the impact of these shocks while addressing longstanding structural economic obstacles to growth.”

Listen: IMF senior South African representative Max Alier on the fund’s SA visit (or read transcript)

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We have a remarkably resilient economy for a socialist state. The ANC mismanages, corrupts, and plunders the national resources under the pretense of being a developmental state. Positive development under the ANC is a contradiction in terms.

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