South African growth outlook has improved but inflation risks abound, central bank says at Davos

South Africa’s economic outlook is better this year than last, but the inflation picture is more muddied as risks abound, its central bank governor said on Tuesday.

South African Reserve Bank (SARB) Governor Lesetja Kganyago told Reuters in an interview at the World Economic Forum’s annual meeting in Davos, Switzerland, that growth in Africa’s most industrialised economy could be close to 2% in 2025, versus the 1.1% growth projected for 2024.

“Depending on who is forecasting, growth varies between 1.6% and 2% (this year). We think … it would be closer to 2% than closer to 1.6%,” he told the Reuters Global Markets Forum.

Kganyago cited the formation of a broad coalition government last year as one of the key enablers of faster growth.

“The structural reform agenda has gained momentum, and it has been given impetus by this Government of National Unity with a very clear focus on taking