IMF questions the road to economic recovery of South Africa

 Unlike most other African nations, South Africa, till very recently, was moving towards a stable path of economic recovery only to have thrashed all the hope with some of the worst financial calls. The same has been confirmed by the International Monetary Fund.

The top financial institution said that it finds the economic recovery of South Africa ‘fragile’. On Friday, the IMF stated that the growth of the country is projected to be below 2% in the medium term due to the implementation of uncertain policies.

The report added that compared to other nations, the speed of recovery of South Africa as a nation against the Covid-19 pandemic has been fast but this speed has failed to be reflected on the economic recovery path. 

"The economic recovery is deemed fragile, as it was accompanied by worsening unemployment, weak bank lending to the private sector, and anemic private investment,” said the report which was being detailed out during consultation of IMF officials with South Africa.

The economic growth however is projected to be at 1.9% in 2022 after an estimated 4.6% rebound in 2021 but once again it has been found to come down to 1.4%  during the medium term.

The IMF officials appreciated the South African government for having found its way to tackle the virus attack since last year’s end till now but highlighted that there are other areas that need improvement. 

They also said that the nation has an opportunity to make some pressing changes ahead of the looming February 23 budget session.

It can use the budget to concrete the measures which are needed in connection to the public sector and rationalize the bailouts of the companies under the state’s confidence and other tax-related changes.