After a disastrous 2020 when the South African economy was seriously damaged, economists expect some slow growth.
Professor Jannie Rossouw from Wits Business School has a stark message for what he expects in the future: “Hardship for people who cannot find jobs and stay unemployed.”
Hugo Pienaar, chief economist of the Bureau for Economic Research (BER) at the University of Stellenbosch, expects a two-speed recovery in 2021, with exports benefitting from a robust global economic recovery. “Domestic demand may be more sluggish, especially if we experience a severe third wave. This could see some of the recovery that should have taken place in 2021 postponed into 2022.
“The strength of the recovery will also crucially be influenced by how quickly Eskom can complete the necessary maintenance on its rapidly ageing coal-fired power stations and how quickly increased private sector power generation can come on stream.”
According to Annabel Bishop, Investec chief economist, she forecasts GDP growth of 2.9% for this year. “The deep scarring that the domestic economy experienced from the harsh regulated shutdown of economic activity last year will persist until 2024 in real terms when the production of the first quarter of 2020 is finally regained.”
She says if South Africa is quick with its vaccination programme, a better GDP growth outcome could be reaped this year. “However, we could risk recession if the vaccination rollout it is particularly slow and harsh restrictions occur on multiple waves.”
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