AFRICA
Pretoria 5 June 2025
https://oe.cd/South-Africa
@OECDeconomy
GDP per capita needs to grow to ensure continued improvements in living standards
Note: Real GDP is measured at 2020 constant prices and in USD converted using 2020 purchasing power parities.
Source: OECD National Accounts database.
Inflation has eased and is set to remain within target
Note: Core inflation refers to the consumer price index excluding food, non-alcoholic beverages, fuel and energy; the shaded area indicates the projection period.
Source: OECD Economic Outlook database.
Activity will increase modestly, amid high uncertainty
Source: OECD Economic Outlook database.
Strengthening monetary and fiscal frameworks
There is room to align the inflation target with that of major partners
Central bank inflation targets in major trading partners and other large emerging market economies
May 2025
Note: For countries with an inflation target band, targets shown are the midpoint.
Source: National central banks and European Central Bank.
Enhancing job creation and better connecting workers with jobs
Many South Africans struggle to find a job
Easing product market regulations would support business dynamism and job creation
Note: A
Investing in public transport would improve economic opportunities
Average commuting times by transport type
Source: Statistics South Africa (2021), National Household Travel Survey 2020.
Ensuring electricity security: A foundation for growth
Electricity generation has been falling
Electricity supply: Generation and shortages
Note: Loadshedding is a controlled, temporary interruption of electricity supply to certain areas or consumers by an electric utility company when the demand for electricity exceeds the available supply. Data refer to fiscal years, i.e. the 2013 data point refers to the year ending in March 2013.
Source: Eskom.
Further expanding renewable energies will support energy security and the
Barriers to entry in the electricity sector could be eased further
Barriers to entry in the electricity sector Index, 2023-24
Note: Barriers to entry in the electricity sector is one of the four components of the electricity indicator. The indicator for South Africa reflects the laws and regulations in force on 1 January 2023. For some countries, the indicator reflects those in force on 1 January 2024. Source:
Large investment needs in the transmission network require leveraging private finance
Installation of new transmission lines and projected needs
1,000 1,500 2,000 2,500 3,000
Source: Eskom, Transmission Development Plan 2022.
Reforming municipal management and funding would improve service and electricity payments
Amount of arrears payments to the state-utility electricity company Eskom ZAR billion
Supporting climate change mitigation and adaptation
Production is highly emissions-intensive
Greenhouse gas emissions per unit of GDP 2022 or latest available, in kilogramme of carbon dioxide equivalent per USD
Note:
Reducing carbon tax allowances would strengthen price signals
Average net effective carbon price, 2023 EUR per tonne CO2 equivalent
Note: The net effective carbon rate is the net effect of fuel excise taxes, carbon taxes, permit prices and fuel subsidies. Source: OECD Net Effective Carbon Rates database.
Rising global temperatures require reinforcing climate adaptation policies
Difference in average annual surface temperature, 2019-23 compared to 1981-2010
Source: OECD Environment Statistics database.
Main messages
Improve living standards through prudent monetary and fiscal policies and by pursuing efforts to reduce corruption.
Enhance job creation by reducing restrictive regulations, including for informal work.
Promote densification and reduce transport times to connect people with jobs.
Unlock growth potential by reforming the electricity sector to ensure reliable energy supply to firms and citizens.
Support decarbonisation and climate resilience by enhancing the policy framework, gradually increasing the net effective carbon price and improving public transport.
Youth
Green
Fiscal
Electricity
Green
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Disclaimers:
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