27 January 2011
South Africa’s economy is projected to grow by 3.4% in 2011, down 0.1 percentage points from previous projections, the International Monetary Fund (IMF) says in its latest World Economic Outlook.
The South African economy is expected to grow by 3.8 percent in 2012, also down by 0.1 percent from previous projections, according to the report released on Tuesday.
The IMF’s projection for growth in 2011 is in line with that of the South African Reserve Bank, which last week adjusted its figures for 2011 for growth to reach 3.4 percent. The central bank left its projection for 2012 unchanged at 3.6 percent.
Private demand, capital inflows
According to the IMF report, growth in emerging and developing economies remained robust in the third quarter of 2010, buoyed by well-entrenched private demand, still accommodative policy stances, and resurgent capital inflows.
The IMF said that countries in sub-Saharan Africa had recovered quickly from the global economic meltdown, with the region projected to grow 5.5 percent in 2011.
“But the pace of the recovery has varied within the region,” the IMF said. “Output growth in most oil exporters and low-income countries is now close to pre-crisis highs.
Trade, unemployment hamper growth
“The recovery in South Africa and its neighbours, however, has been more subdued, reflecting the more severe impact of the collapse in world trade and elevated unemployment levels that are proving difficult to reduce.”
Growth in emerging and developing economies is expected to remain buoyant at 6.5 percent – a modest slowdown from the seven percent growth registered last year. Asia, however, continues to grow rapidly, the IMF said.