• The power of perseverance

    True grit is a reliable predictor of who will achieve success in life, says Ian Mann.

  • It's the system

    The system sucks and it’s being used far too often as an excuse, says Mandi Smallhorne.

  • Web of dependency

    Zupta defenders are playing cat and mouse with ratings agencies, says Solly Moeng.

All data is delayed
Loading...
See More

IMF dims SA growth prospects

Aug 23 2012 19:15
AFP

Johannesburg - The International Monetary Fund slightly dimmed South Africa's 2012 growth forecast to 2.6% on Thursday and warned that chronic joblessness was a risk to the continent's biggest economy.

"If not addressed, the stubbornly high unemployment rate could become politically and socially unsustainable," an IMF report said.

Released after a visit by IMF representatives three months ago, the study also warned of external risks from the eurozone and a Chinese slowdown that could see less demand for exports and a further decline in commodity prices.

The Fund revised lower a forecast for growth of 2.7% issued in May.

"Although the 2012 GDP growth rate is likely to moderate to about 2.6% given the weak external conditions and heighted global uncertainty, it is projected to gradually recover over the medium term to its potential rate of about 3.5%," it said.

The forecast for 2013 was cut from 3.6% to 3.4%.

Some key domestic risks identified were the high unemployment rate, which officially hovers around 25%, and the ballooning cost of public sector wages.

"The growing public sector wage bill is a concern and the composition of spending needs to be rebalanced away from the wage bill and toward capital spending," said the report.

The National Treasury welcomed the assessment, saying "many of the issues raised by the IMF report are already reflected in the priorities and outcomes that government has set itself".

*Follow Fin24 on Twitter, Facebook and Google+.

imf  |  economy

NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
8 comments
Comments have been closed for this article.
 

Company Snapshot

We're talking about:

THE DEBT ISSUE

Debt is one of the biggest financial issues facing South Africans today. Find out how you can avoid and manage your debt with Fin24 and Debt Rescue.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Would you take out a payday loan?

Previous results · Suggest a vote

Loading...