Economic growth in SA: what has gone wrong?
How the country’s growth rate is steering it away from economic success
After South Africa recorded a tepid economic growth rate of 0.3% in 2016, a very moderate – but still negligible – gross domestic product (GDP) expansion of 0.5%–1% is on the cards this year, with a slight acceleration in the next two years. Obviously, anything is better than nothing. However, in the light of the country’s unfortunate bouquet of adverse macro- and socioeconomic realities, anything less than 4% is inadequate. The harsh reality is that a growth path of 6% per year for a period of at least 20 years is a necessary (if not sufficient) condition to make meaningful inroads into unemployment, poverty and income inequality. Moreover, this target must be achieved in a global economic environment that is less friendly and more volatile than 10 years ago. The global recession, the ongoing tepid growth in Western Europe, the growth slowdown in China, the significant decline in resource prices, and a debilitating drought have inhibited South Africa’s growth performance over the ...
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