IT shielded from downturn, for now
South Africa’s economic growth rate is at high risk of stalling this year, and dipping into negative territory.
13 June 2023
Whether or not South Africa enters a recession this year is largely academic (a recession is defined as two consecutive quarters of negative growth). The stone-cold fact is that the economy will not grow this year. In April, the International Monetary Fund cut its growth estimate for South Africa to just 0.1% – down from 1.2%. This was the largest reduction among major economies, and is in line with forecasts from the Reserve Bank and Investec.
Businesses and households are being battered by constant loadshedding, often at intense severity. Under stage six, supply is interrupted for as much as 10 hours a day. This has seen costs skyrocket as businesses rely on diesel generators (and sometimes overtime shifts) to trade.
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