Economy grows steadily, falling short of predictions.

In a recent interview, Lisette IJssel de Schepper, chief economist at the Bureau for Economic Research (BER), highlighted the progress made in terms of power disruptions but emphasized the unresolved issues in other areas such as Transnet inefficiencies.

Despite a noticeable improvement in Eskom’s performance, factory activity slumped in August, indicating ongoing volatility in key sectors. However, IJssel de Schepper remains optimistic about the potential for growth, especially with the government pension policy reform and anticipated interest rate cuts by the central bank.

The forecast suggests a growth of 2.2% in 2025, a significant leap from the current 1% growth rate. However, to sustain this growth, reforms to enhance the country’s growth potential are crucial. The government pension policy reform is expected to boost household consumption spending and GDP growth through withdrawals of R40bn to R100bn by year-end.

Overall, while challenges remain, there is hope for faster growth ahead with the right reforms and policy adjustments in place.

Source