South Africa Economic Update : Tertiary Education Enrollments Must Rise
South Africa's much anticipated economic rebound in 2018 did not occur. While substantial efforts by the authorities to strengthen governance of public resources and stabilize the fiscal situation helped the economy to not contract further, ec...
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| Format: | Report |
| Language: | English |
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World Bank, Pretoria
2019
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| Online Access: | http://documents.worldbank.org/curated/en/173091547659025030/South-Africa-Economic-Update-Enrollments-in-Tertiary-Education-Must-Rise http://hdl.handle.net/10986/31241 |
| Summary: | South Africa's much anticipated
economic rebound in 2018 did not occur. While substantial
efforts by the authorities to strengthen governance of
public resources and stabilize the fiscal situation helped
the economy to not contract further, economic growth
remained tepid with a technical recession (two successive
quarters of negative economic growth) in the first half of
2018. GDP growth is expected at below 1 percent in 2018,
down from an already low 1.3 percent in 2017. A number of
exogenous factors contributed to this poor growth
performance. Domestically, climate variations such as a
prolonged drought in the Western Cape where harvests were
delayed exerted a huge toll on agricultural production.
Externally, mounting trade tensions between the United
States and China, and tightening global financial conditions
contributed to slowing the pace of foreign financial inflows
to South Africa while lessening the demand for its exports.
Rising world oil prices also exerted strong pressure on the
balance of payments and domestic prices, depressing private
consumption. These negative developments, however, do not
conceal the fact that South Africa's growth challenge
is deep-seated and largely structural. To grow faster and
sustainably, the economy will need to be more inclusive,
requiring the participation of a greater share of the
population mainly through job creation. Furthermore,
persistent inequality of income and of opportunity will
continue to raise pressures for redistribution of limited
resources that are drawn from a small tax base. Radical
policy demands are more likely in a stagnant economy, fuel
policy uncertainty and deter private investment. At the
Presidential Jobs Summit and the South African Investment
Conference held in October 2018 agreements were made on
actions that are expected to enable job creation and to
attract higher levels of investment, including interalia,
education and skills interventions, and initiatives to
reduce policy uncertainty on land reform, mining and black
economic empowerment. |
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