The International Monetary Fund (IMF) has downscaled its forecast for our country’s economy for this year to only 1,4%, down from 2%.
The GDP is expected to only grow by 1,3% next year, forecasts the IMF, the slowest rate of growth since the last recession in 2009. China’s economic slowdown is largely to blame, with metal imports reducing due to that country’s ‘slump‘. Mining jobs are in jeopardy, and electricity shortages have restricted production, pushing business confidence to a 22-year low.
The IMF GDP growth forecast is more pessimistic than that of the World Bank and the Reserve Bank, with projections for this year and next year at 1,5%/1,7% (World Bank) and 1,5%/1,6% (Reserve Bank). The weakening Rand is not helping grow exports by much due to the weaker global demand, and due to power outages.
The Reserve Bank says that it hopes ‘to avoid a recession’. It does not expect the GDP to show negative growth, despite manufacturing output having shown negative growth in six of the first eight months of this year. At an average growth rate of only 1,5% last year, this year, and next year, prospects for job creation are not good, say economists.
Source: Fin24.com
Chris von Ulmenstein, WhaleTales Blog: www.whalecottage.com/blog Tel 082 55 11 323 Twitter:@WhaleCottage Facebook: click here
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