Celebrating 0.8% GDP growth is delusional, says Free SA
Economic challenges persist despite 0.8% GDP growth in South Africa
Image: Supplied
Statistics South Africa (Stats SA) recent announcement that the country’s real gross domestic product (GDP) expanded by 0.8% in the latest quarter has been described by the Free South Africa Campaign (Free SA) as not ‘encouraging and delusional'.
Free SA has strongly criticised the reaction to the GDP figures, arguing that the modest growth masks deeper economic challenges and signals backward movement for the country.
Stats SA’s chief director for national accounts, Dr Bokang Vumbukani-Lepolesa, reported that eight of ten industries registered growth, with manufacturing contributing the most, followed by mining and trade.
However, Paul Maritz, Director of the Free South Africa Campaign, dismissed the upbeat interpretation.
“There’s no reason for celebration or optimism. A growth rate of 0.8% in a country where the population is growing faster than that means we are effectively going backwards,” Maritz said.
“This modest uptick is far from encouraging. It reflects an economy still trapped in old patterns, relying heavily on traditional sectors like mining and agriculture. That’s not progress, it’s stagnation.”
Maritz highlighted the country’s overreliance on legacy industries and its failure to embrace innovation, technology, and artificial intelligence.
“The fact that we continue to lean on these sectors instead of embracing innovation, technology, and AI is a sign that a rapidly moving global economy is leaving behind South Africa.
“We are not in a healthy economic environment. It’s not a good place to start a business and certainly doesn’t offer much hope for young people. That’s why youth unemployment remains alarmingly high, and many businesses struggle to survive."
He called on the government to reconsider its approach
“This should be a wake-up call to the government. Celebrating 0.8% growth is delusional when the structural issues undermining our economy remain unaddressed.
“The sectors that continue to underperform - such as transport and construction - need to show improvement if we are serious about a sustainable recovery.”
Maritz added that the relative success of mining and agriculture came more from "geographic luck" than effective governance.
“We need an enabling environment for entrepreneurs, innovation, and growth from the ground up. That requires the government to step aside where it obstructs progress and to support the business leaders and job creators who can build the economy our children deserve.”
His prescription for reform includes deregulation, infrastructure investment, and improved delivery of basic services.
“South Africa requires deregulation to enable business, infrastructure investment, and development, and the government needs to do the basics like water, electricity, and safety right,” said Maritz.
thabo.makwakwa@inl.co.za
IOL Politics