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Treasury Responds to IMF Article IV Consultation

November 26, 2019

National Treasury

26 November 2019

National treasury remains committed to achieving inclusive growth that will create jobs, eradicate poverty and reduce inequality.

Treasury reiterated this in a statement announcing that the International Monetary Fund (IMF) has concluded its Article IV Consultation to South Africa (SA).

The IMF visited SA from 6 -21 November 2019 to discuss economic and financial developments in the country.

Main findings in the IMF’s concluding statement include that South Africa faces three main challenges, namely, weak economic growth, a deteriorating fiscal situation and difficulties in the operations of state owned enterprises.

The IMF recommends that “South Africa creates an environment conducive for private sector investment and takes a decisive approach to implement structural reforms in order to boost economic growth”.

Areas highlighted by treasury in which progress has been made this year include the gazetting of the revised Integrated Resources Plan, simplification of the visa regime, removal of unabridged birth certificate requirement for young tourists, setting up of more Special Economic Zones, directive on licensing of high demand broadband spectrum and appointment of a new CEO for Eskom.

Treasury added that the recently released economic discussion paper has “proposed a number of economic reforms that can boost GDP growth over the medium and longer term, and support increased investment and job creation”.

Meanwhile, in another statement outlining government’s response to the rating action of S&P Global Ratings in which the outlook was revised from stable to negative, treasury emphasized that meaningful progress has been achieved on the measures announced by president Ramaphosa in September 2018.

Treasury declared that “government, labour, business and civil society need to work hand-in-hand as difficult decisions that imply short-term costs for the economy and fiscus need to be made in order to turn the tide around”.