KPMG South Africa has forecast an economic growth of about 1,5% in 2025, and a further 1,8% in 2026 for South Africa.

In an economic outlook published in December 2024, KPMG said interest rates are set to continue to decline, which will subsequently provide breathing room for consumers and business alike.

The unemployment rate is still a concern and is expected to decrease slightly from a current 33% over the same period.

Geopolitical risks remain elevated with post – US election policies, including possible tariffs potentially hitting growth and inflation in 2026.

Frank Blackmore, Lead Economist at KPMG, said at the time, “the positive sentiment following South Africa’s general elections in May 2024, the improved performance of electricity supply as well as more recent reductions in inflation, underpin a more optimistic view of the economy over the forecast period.”

On Friday, the 17th January 2025, the International Monetary Fund (IMF) forecast Regional growth of around 4,2%.
South Africa’s growth is expected to decline from a forecast of 1,1% to 0,8%. This is due to a decline in agriculture, forestry and fishing, as a result of drought.

But the IMF showed optimism at Government’s introduced reforms, which it said, is key to its growth path.

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