“While the South African GDP outlook has seen a downward revision, this happens in a global context where the World Bank indicates that international trade and investment are moderating,” Brand South Africa said on Monday.
The state agency added that the report came out as the “global economy and trading system is being challenged by trade tensions that remain elevated.”
“Important for South Africa is the fact that increased trade tensions between major economies stand to have a negative impact on commodity exporters due to potential price volatility,” Brand South Africa said.
The World Bank had in June 2018 initially projected South Africa’s growth to be 1.8%.
However, the downward revision of the GDP outlook for 2019 was attributed to high levels of unemployment, challenges in mining production, low business confidence, policy uncertainty, as well as slow growth in household credit extension, which could constrain domestic demand.
“While we acknowledge the bank’s report, which states that South Africa’s growth is considerably lower than the 4.2% projected average of its emerging market peers, let us be reminded of the economic revival, and investment initiatives which have been put in place over the last year by President Cyril Ramaphosa,” Brand South Africa general manager for research Petrus de Kock said.
He said the success of the inaugural Investment Conference, as well as the Job Summit, are coming to fruition.