IMF Staff Country Reports

South Africa: Post-Financing Assessment-Press Release; and Staff Report

September 4, 2024

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International Monetary Fund. African Dept. "South Africa: Post-Financing Assessment-Press Release; and Staff Report", IMF Staff Country Reports 2024, 283 (2024), accessed December 21, 2024, https://doi.org/10.5089/9798400286186.002

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Summary

This paper presents South Africa’s Post-Financing Assessment report. The new government of national unity that took office in June faces significant challenges, including declining real per capita growth, high unemployment, poverty, and inequality, and a rising level of public debt. The new administration has committed to address these challenges by continuing ongoing structural reforms aimed at addressing supply constraints and bolstering inclusive growth, while maintaining fiscal discipline. Monetary policy should carefully manage the descent of inflation to the mid-point of the target range and stay data dependent. The report recommends that policies should focus on bolstering inclusive growth and restoring fiscal sustainability, while managing the descent of inflation to target and safeguarding financial stability. Monetary policy should stay data dependent and rate cuts be considered only after inflation declines sustainably toward the midpoint of the target range. The authorities should continue to monitor financial sector risks, including those related to the bank-sovereign nexus, and enhance supervision and prudential regulations.

Subject: External debt, Fiscal policy, Fiscal stance, Public debt, Revenue administration

Keywords: Africa, Fiscal stance, Global, Government operation, IMF team, IMF's transparency policy, Inflation decline, Per-capita GDP figure, Policy discussion, U.S. dollar

Publication Details

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