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Systematic Country Diagnostic (SCD)

South Africa growth forecasts: Better to err on the side of caution

Marek Hanusch's picture
Forecast for South African 2018 GDP growth.

Following the change of political leadership early in 2018, South Africa was gripped by a wave of optimism. Analysts raised their growth forecasts for the year significantly (Figure 1). At the World Bank, we were more cautious, warning in our 11th South Africa Economic Update that South Africa’s growth challenges were deep-seated and structural and would take considerable policy action and time before translating into higher growth. Nevertheless, we too raised our forecast, to 1.4% for the year. Although this made our forecast one of the most pessimistic among South African observers, we were wrong: we were too optimistic! Like other economists, we now expect growth for 2018 to have averaged less than 1%.

An incomplete transition: Overcoming the legacy of exclusion in South Africa

Marek Hanusch's picture


Sandton Bridge separates two South African communities that are worlds apart; Sandton, an affluent area believed to be the richest square mile in Africa, and Alexandra Township, one of the poorest urban areas in the country. Credit: World Bank