IMF trims SA growth forecast on policy uncertainty
Lender warns that structural bottlenecks will continue to weigh on investment and productivity
Less than a month before the general election, the IMF has taken a grim view on SA’s growth outlook. The Washington-based lender cut growth forecasts to 1.2% for 2019 from 1.4% and 1.5% for 2020 from 1.7%. It kept growth forecasts unchanged in January, but had revised down significantly in October 2018. This is below the Treasury’s forecast of 1.5% for 2019 and the Reserve Bank’s projection of 1.6%. "The projected recovery reflects modestly reduced but continued policy uncertainty in the SA economy after the May 2019 elections," the IMF said in its World Economic Outlook released on Tuesday.
This follows a warning from S&P Global Ratings that SA’s growth remained too low for a ratings upgrade.The credit-rating agency cut SA’s debt assessment to sub-investment grade in April 2017, after then president Jacob Zuma fired Pravin Gordhan as finance minister in a surprise cabinet reshuffle.In November, S&P affirmed SA’s long-term currency debt at BB+, the first notch of sub-investm...
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