GDP growth is forecasted to improve over the medium term as infrastructure constraints ease, private investment recovers and exports grow. However, recent trends such as sudden power cuts caused by labour strikes in the mining sector has led to understandable concern about the country’s growth prospects, weakening South Africa's infrastructure.
The South African economy only grew 1.5% in 2014, which is comparatively small when compared to other developed nations around the world who are adopting technological change and achieving soaring GDPs. Furthermore, unemployment rates have risen to a shocking 25% and the country has lost $25bn since 2008 because of electrical shortages, placing South Africa in a debt status.
Therefore, it is essential for the minister of South Africa to implement measures that aid the country in overcoming its debt crisis and labour shortage, hence be able to boost economic growth. These measures could include motivating workers through increased wages or non-monetary incentives and reinforcing expansionary monetary policies by the central bank to increase money supply through discount rates in order to encourage firms to increase their investment.
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