South Africa’s economy is expected to shrink by 8% in 2020, due to the effects of Covid-19 and the resulting lockdown. This is according to the International Monetary Fund (IMF).
The international finance body expects the economy to bounce back and grow by 3% in 2021, lower than an earlier forecast which saw South Africa’s economy growing by 3.5%.
World GDP will fall by 4.4% this year, an improvement on the 5.5% initially forecast. The upwards revision in the global GDP forecast is due to the fact that advanced economies seem to have recovered more quickly than was initially expected.
Africa was expected to be hard hit by the global economic contraction with the continent set to see its GDP decline for the first time in decades. The IMF MD, Kristalina Georgieva, called the impact on Africa ‘very, very significant’.