The IMF has revised South Africa’s GDP growth forecast for 2023.
South Africa must implement reforms to boost private-sector investment, promote good governance and improve the efficiency of public spending to shore up an economy hamstrung by rolling blackouts, the International Monetary Fund said.
The National Treasury is aware of “most of the risks to economic growth” flagged by the lender and is working on measures to address them, it said in a statement. It plans to respond to more detailed analysis and recommendations when the IMF publishes an Article IV report on the country. If implemented, a R254 billion debt-relief strategy the Treasury has announced for Eskom “should ensure material improvement in the company’s operation and establish its long-term viability,” it said.
Creating the conditions for higher economic growth and a reduction in South Africa’s debt vulnerabilities will require stronger fiscal consolidation efforts, including plans to reduce the public-sector wage bill and transfers to state companies while protecting well-targeted social spending and productive public investments, the IMF said.
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