South Africa at Risk if Economic Reforms Don’t Materialise Fast Says IMF

JOHANNESBURG – South Africa faces a prolonged period of weak economic growth marked by rising unemployment, inequality and greater credit-rating risk if the government does not act fast to implement reforms, the International Monetary Fund (IMF) said on Monday.

“The FY20/21 budget to be presented in February should articulate measures to address fiscal and SOE (state-owned entities) challenges and stabilize government debt,” the global lender said in statement at the conclusion of a 2-week, Article IV visit to the country.

“Failure to implement the needed adjustment in government and SOE spending and efficiency will worsen debt dynamics, erode financial stability, and further raise the country risk premium.”

(Reporting by Mfuneko Toyana; Editing by Mark Heinrich)