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South Africa’s African growth outlook seen in a dim light

August 8, 2013

In the lastest African Development Bank African Economic Outlook Growth, South Africa’s economic growth will continue to lag that of other African countries. African Development Bank puts South Africa in 10 slowest growers, with likes of Swaziland, underscoring urgent need to implement National Development Plan.

GROWTH in South Africa will continue to lag that of other African countries, with the latest African Development Bank African Economic Outlook report listing the country among the 10 that will grow the slowest in 2013.

The report, released on Wednesday, backs what government and business this week referred to as the urgent need for the implementation of the country’s multiyear growth and development strategy, the National Development Plan (NDP), to get South Africa on a higher economic growth trajectory.

South Africa joins nine other countries including Sudan, Egypt and Swaziland as the 10 slowest-growing countries in Africa.

Sierra Leone, Angola, Zambia and Mozambique are among the fastest-growing.

The African Development Bank (AfDB) forecasts South Africa’s gross domestic product (GDP) to grow 2.8%, much more positive than current expectations of around 2%.

“In 2012, economic growth in South Africa was adversely affected by heavy strikes in the mining sector and the recession in the euro area. With improved global demand and supportive macroeconomic policies, a gradual recovery is expected for 2013 and 2014,” bank chief economist and vice-president Mthuli Ncube said.

The bank said Southern African GDP would probably grow 4.1% this year, accelerating to 4.6% next year.

Zimbabwe, which has just emerged from a national election won by President Robert Mugabe’s Zanu (PF), continued to record positive growth rates of above 5%, Mr Ncube said.

“But due to the economic crisis, with declining production levels until 2009, by the end of 2014 real GDP will still be more than a quarter lower than in 2001,” he said.

The bank is confident of continued growth in Africa, led by forecasts for strong growth in Western African countries and support from spending by a growing middle class.

The report said that while Africa’s economy continued to show a high degree of resilience against global economic turbulence, the growth momentum had eased in countries with strong links to global markets.

The continent’s average GDP growth is likely to amount to 4.8% in 2013 and 5.3% in 2014, the report forecasts.

“Domestic demand was often boosted through private consumption and investment, both public and private,” the report said.

“Higher earnings in domestic sectors, record inflows of remittances and expanding consumer credits backed private consumption.”


From → Africa, Global Trends

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