HILARY JOFFE: Stuck government is biggest bar to growth
The state is a regulatory morass, focused more on compliance than enabling growth
As 2024 comes to an end we’ve had upbeat updates on SA from the three global ratings agencies and the IMF. All say the same, in varying degrees. SA has formidable challenges. But it also has an economy with significant strengths — one that has the potential to grow much faster if we stay on the path of reform and step up the pace. The government of national unity (GNU) gives us the opportunity to realise that potential. If we blow it, we will be in real trouble.
Going into the new year the IMF and other economists have lifted their forecasts at least a little, with confidence improving, electricity supply stabilising and interest rates declining. The IMF forecasts 1.1% growth this year (https://www.businesslive.co.za/bd/economy/2024-11-28-imf-urges-sa-to-adopt-a-more-aggressive-fiscal-plan/), rising to 1.5% next year and 1.8% by the end of the decade in its baseline. Moody’s has similar numbers, with growth getting close to 2% as bottlenecks ease; S&P’s are more muted but sti...
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