Some economists have warned that the World Bank’s new forecast for South Africa’s economic growth might be too optimistic for the country to realise.
The bank has cut the country’s economic growth outlook to below 1% for 2020 due to electricity concerns. The bank now forecasts the growth at 0.9% this year from 0.7% in 2019.
Eskom has announced that it will downgrade its stage 2 load shedding to stage one from 6 o’clock on Friday morning to 11 o’clock on Friday night. On Thursday the power utility continued with stage 2 load shedding throughout the day.
Ian Cruickshank is the Chief Economist at the Centre for Risk Analysis says, “For consumers and business, both pulling back saying it’s not the right time for spending, where are we going to get finance from. I’m afraid, in an environment where there’s a decline in electricity supply, where there’s declining activity in all areas of commerce and industry. The forecast might be optimistic. It’s a sad reflection but we’ve got to look at the facts. It took ten years to break down the economy, they can’t fix that. Ramaphosa understands the problems. I’m sure of that, but it can’t be done in a month or even one year.”