South Africa’s Economic Reform Ambitions Fall Short Of What’s Required: A Few Pointers

MATTHEW KOFI OCRAN

OVER the past two decades various African National Congress (ANC) administrations in South Africa have sought to redistribute income to the poor and the vulnerable. They have also sought to stimulate rapid economic growth.

The administrations have made progress in the redistribution effort, but on economic growth the performance has been dismal. For example, the National Development Plan, the first draft of which was released in August 2012, was intended to move the country to a higher annual growth trajectory of 5%. This hasn’t happened. Over the past decade, growth has averaged less than 2% annually.

Even before the onset of the COVID-19 pandemic in the first quarter of the year the economy was in a technical recession – defined as two consecutive quarters of negative growth. Since then the situation has deteriorated. GDP for the second quarter of 2020 shrank by 16.4% year-on-year, and by 51%