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South Africa experienced a remarkable economic growth deterioration between 2005 and 2025. This report uses a growth accounting framework to show that productivity shrunk and investment stagnated. Post-pandemic, productivity has recovered but not investment. Cutting red tape, political certainty and faster progress on other structural reforms will reignite growth.
Read MoreSouth Africa is facing an escalating crisis in its water sector, characterised by deteriorating infrastructure, operational inefficiencies, and a failure to expand access to quality water for a significant portion of its population. This situation necessitates a critical evaluation of alternative models for water service provision. The Siza Water (KwaZulu-Natal) and Silulumanzi (Mpumalanga) concessions reveal that private operators can achieve high levels of operational efficiency and service quality, and that private-sector participation (PSP) is a viable option if designed correctly.
Read MoreSouth Africa’s persistent skills shortage remains a critical barrier to economic growth, with around half of all manufacturing firms citing it as a significant constraint. The Sector Education and Training Authority (SETA) system was created to solve this problem but has proven to be inefficient and ineffective. The report proposes restructuring the system and moving towards a more effective approach that prioritises skills for growth.
Read MoreDepending on how public debt is measured, SA’s debt for 2024/25 ranged from 69.2% to 129% of GDP. This may seem at odds with the gross and net loan debt ratios of 76.9% and 73.8% presented by the National Treasury in the national budget this week. However, there are different measurement approaches, particularly in relation to debt coverage (i.e., what is included in the debt calculation). While we fixate on the official debt numbers, it is important not to lose sight of the broader, less examined risks that lurk on the public balance sheet.
Read MoreOur latest infographic examines South Africa’s economic trajectory through the lens of the Balance of Payments. By unpacking key trends in trade, capital flows, and foreign reserves, it offers insights into the forces shaping macroeconomic stability in an open economy like South Africa.
Read MoreThe International Monetary Fund (IMF) has recommended that South Africa adopt fiscal rules, and the National Treasury has committed to a process of consultations on fiscal rules, and to release a discussion by the end of March 2025. This research note explores what fiscal rules are and whether they could improve South Africa’s fiscal sustainability and fiscal credibility. It highlights guiding principles and considerations for fiscal rule design and outlines a possible fiscal rule to initially stabilise debt followed by a debt reduction phase.
Read MoreThe International Monetary Fund (IMF) has recommended that South Africa adopt fiscal rules, and the National Treasury has committed to a process of consultations on fiscal rules, and to release a discussion by the end of March 2025. This research note explores what fiscal rules are and whether they could improve South Africa’s fiscal sustainability and fiscal credibility. It highlights guiding principles and considerations for fiscal rule design and outlines a possible fiscal rule to initially stabilise debt followed by a debt reduction phase.
Read MoreThe 2024Q3 contraction in GDP underlines the need for a programme of economic reform to restart economic growth. At this stage, the BER’s baseline forecast is for growth to average just below 2% from 2026 to 2029. While this would be faster than the decade prior to the pandemic, this is not enough. In this Comment, the Impumelelo Economic Growth Lab evaluates four areas of focus for policy reform that could lift growth over 3%. But the crux is in the implementation, and any further delays will mean that 3% becomes more and more difficult to reach.
Read MoreOperation Vulindlela 2.0 will, among other priorities, focus on strengthening local government to “achieve rapid, inclusive growth.” This research note examines critical reforms to enhance municipal performance, highlighting skills shortages, declining infrastructure investment, and political interference. It proposes recommendations to improve governance, accountability, and service delivery outcomes that are vital to unlock economic opportunities.
Read MoreUS-based economists Daron Acemoglu, Simon Johnson, and James Robinson have been awarded the 2024 Nobel Prize in Economics for their research on the factors influencing strong or weak economies. BER Senior Economist and author of How to Fix (or Unf*ck) a Country, Dr Roy Havemann, shares his insights on this topic in an interview with John Maytham on The Afternoon Drive show
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