SA’s power crisis biggest impediment to growth – OECD
A new survey of South Africa has found that even though the country's economy rebounded strong last year from the effects of Covid-19, the recovery has been interrupted by Russia's invasion of Ukraine.
"Steep increases in energy and food prices undermining confidence and hurting consumption. Inflation rates 7.4% in June above the upper limit of the target band of 3 to 6% and well above reserves objective of 4.5%," says OECD's Isabell Koske.
"The central bank should stand ready to raise interest rates further in case inflation continues drifting away from the target band.
"After the strong rebound in 21' we expect growth to slow down to 1.8% this year and 1.3% next year and the economy is only expected to reach its pre-pandemic level by the end of this year."
READ: Ramaphosa unveils plan to end load shedding
The findings of the 2022 survey was presented by the OECD on Thursday.
It examined the impact of the Covid-19 crisis on South Africa’s economy and society.
It also proposed reforms to overcome long-running structural weaknesses and raise living standards.
Koske says electricity shortages have become the most pressing impediment to growth.
Listen below:
MORE ON ECR
