South Africa: Economic Outlook

The report explores:

• The medium-term GDP growth outlook for SA
• The growing fiscal deficit and the likelihood of a debt trap
• The ability of the ZAR to sustain its current strength
• The future performance of SA equity markets

Key takeaways:

• Government expenditure is projected to reach 41.9% of GDP by the end of 2020/21.
• Government revenue is forecast at 26.3%.
• Budget deficit projections
  • the National Treasury forecasts a deficit of 15.7% for 2020/21; 8.6% for 2022/23.
  • the CRA forecasts a deficit of 17% for 2020/21; 10% for 2022/23.
• The labour market absorption rate is 37.5% — a far cry from global norms of around 60% to 70%.
• The Rand may hold its current levels or strengthen but is likely to weaken in the medium-to-long term.