{
  "title": "South Africa: 2019 Article IV Consultation—Press Release; and Staff Report; and Statement by the Executive Director for South Africa",
  "publication": "IMF Staff Country Reports, January 30, 2020",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2020/01/29/south-africa-2019-article-iv-consultation-press-release-and-staff-report-and-statement-by-49003",
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  "summary": "This 2019 Article IV Consultation with South Africa discusses that subdued private investment and exports, and increased uncertainty have depressed growth and worsened social indicators.",
  "sections": [
    {
      "heading": "Key findings on growth and labor markets",
      "content": "- Subdued private investment and exports, and increased uncertainty have depressed growth and worsened social indicators.\n- Given the structural nature of the growth slowdown, reforms are needed that reduce the cost of doing business and boost private investment.\n- Subject tags include: Banking, Fiscal policy, Fiscal stance, Inflation, Labor, Labor markets, Prices, Public debt, Revenue administration.\n- Keywords include: Africa, CR, debt, Fiscal stance, Global, government, government policy, headline CPI inflation, IMF South Africa team, Inflation, inflation target range, ISCR, Labor markets, policy, policy directive, U.S. dollar."
    },
    {
      "heading": "State-owned enterprises (SOEs), fiscal position, and public debt",
      "content": "- SOEs’ risks are materializing, triggering government bailouts of Eskom and administrative intervention in other entities.\n- High fiscal deficits have boosted debt.\n- Recommendation: establish a credible debt anchor to stabilize debt in the medium term.\n- In the absence of fiscal space, a gradual and growth-friendly fiscal consolidation and increased spending efficiency are needed.\n- The consolidation should be accompanied by structural reforms to support private investment."
    },
    {
      "heading": "External position and financial flows",
      "content": "- Nonresident investors are shedding equities and local currency bonds but showing appetite for foreign currency sovereign bonds amid supportive global financing conditions.\n- The external position is assessed as moderately weaker than implied by fundamentals and desirable policies."
    },
    {
      "heading": "Inflation and prices",
      "content": "- Inflation has slowed to around the mid-point of the target band, aided by one-off factors, but inflation expectations are higher.\n- Keywords highlight focus on headline CPI inflation and the inflation target range."
    },
    {
      "heading": "Banking sector and financial stability",
      "content": "- Banks are sound, albeit with pockets of vulnerabilities."
    },
    {
      "heading": "Policy recommendations and priorities",
      "content": "- Implement a gradual, growth-friendly fiscal consolidation paired with spending-efficiency improvements.\n- Establish a credible debt anchor to stabilize public debt in the medium term.\n- Pursue structural reforms to lower the cost of doing business and boost private investment, addressing the structural nature of the growth slowdown.\n\n---\n\n Content in this bundle\n\n- 1zafea2020001\n  - 1zafea2020001 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - 1zafea2020001 (PDF){rel=\"external\" type=\"application/pdf\"}"
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    "Published: January 30, 2020",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9781513528502.002",
    "Subdued private investment and exports, and increased uncertainty have depressed growth and worsened social indicators.",
    "Given the structural nature of the growth slowdown, reforms are needed that reduce the cost of doing business and boost private investment.",
    "Subject tags include: Banking, Fiscal policy, Fiscal stance, Inflation, Labor, Labor markets, Prices, Public debt, Revenue administration.",
    "Keywords include: Africa, CR, debt, Fiscal stance, Global, government, government policy, headline CPI inflation, IMF South Africa team, Inflation, inflation target range, ISCR, Labor markets, policy, policy directive, U.S. dollar.",
    "SOEs’ risks are materializing, triggering government bailouts of Eskom and administrative intervention in other entities.",
    "High fiscal deficits have boosted debt.",
    "Recommendation: establish a credible debt anchor to stabilize debt in the medium term.",
    "In the absence of fiscal space, a gradual and growth-friendly fiscal consolidation and increased spending efficiency are needed.",
    "The consolidation should be accompanied by structural reforms to support private investment.",
    "Nonresident investors are shedding equities and local currency bonds but showing appetite for foreign currency sovereign bonds amid supportive global financing conditions.",
    "The external position is assessed as moderately weaker than implied by fundamentals and desirable policies.",
    "Keywords highlight focus on headline CPI inflation and the inflation target range.",
    "Banks are sound, albeit with pockets of vulnerabilities.",
    "Implement a gradual, growth-friendly fiscal consolidation paired with spending-efficiency improvements.",
    "Establish a credible debt anchor to stabilize public debt in the medium term.",
    "Pursue structural reforms to lower the cost of doing business and boost private investment, addressing the structural nature of the growth slowdown.",
    "**1zafea2020001**"
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