CAPE TOWN, Oct. 30 (Xinhua) -- South Africa's economic growth forecast has been revised down from 1.3 percent to 1.1 percent for 2024, Finance Minister Enoch Godongwana announced Wednesday during the Medium-Term Budget Policy Statement speech in the National Assembly in Cape Town, the country's legislative capital.
"Domestically, we forecast a real GDP growth of 1.1 percent in 2024. This is lower than the estimate of 1.3 percent in February," said Godongwana. "Over the medium term, growth is forecast to average 1.8 percent."
"This underscores the need for higher inclusive growth to meet the aspiration of a better life for all," he said.
In his speech, Godongwana outlined the government's strategy to elevate the economy toward a higher and more inclusive growth trajectory. "The strategy is anchored on four pillars: one is maintaining macroeconomic stability; two is implementing structural reforms; three is supporting growth-enhancing infrastructure; and four is building state capability," he said.
Meanwhile, the finance minister raised concerns about South Africa's rapidly increasing debt. "We are anticipating that government debt will reach more than 6.05 trillion rand (about 342 billion U.S. dollars), or 75.5 percent of GDP, in 2025/26," said Godongwana.
The official, however, noted that the South African government has taken significant steps to address this issue by reducing the budget deficit. As a result, the country achieved a primary budget surplus in 2023/2024 for the first time in 15 years and is on track to maintain a primary surplus in 2024/2025.
"Over the medium term, the main budget deficit will decline from 4.7 percent of GDP in 2024/25 to 3.4 percent in 2027/28, with the primary budget surplus rising to 1.8 percent of GDP," Godongwana said. "The primary surplus will be sufficient for debt to stabilize at 75.5 percent in 2025/26. Debt will then decline over the rest of this decade."
