South Africa’s electricity grid has stabilized, its ports are moving cargo more efficiently, and its railways are performing measurably better than they were just a few years ago. These are the operational foundations Standard Bank Group chief economist Goolam Ballim points to when projecting GDP growth of 1.7% next year and 2% in 2028, a trajectory he describes as the product of concrete infrastructure delivery rather than optimism alone.
The country’s economic performance has been poor by any measure, averaging less than 1% annual growth over the past decade as mismanagement and corruption hollowed out institutional capacity and service delivery. What changed is the systematic repair of those systems. Chronic power shortages that once crippled manufacturing and services have been addressed. Logistics bottlenecks constraining exports and commerce have eased. These are not projections. They are outcomes already registered.
Additional reference context is available at https://www.moneyweb.co.za/news/south-africa/south-africa-economy-nears-escape-velocity-standard-bank-says/.
“We’ll continue to incrementally build toward escape velocity,” Ballim told Bloomberg from Cape Town. “The foremost ingredient in this 2%-plus growth trajectory relates to institutional capacity.” His forecast exceeds the International Monetary Fund’s 2027 projection of 1.3%, reflecting a judgment that institutional reform delivery will accelerate beyond current expectations.
The repair work extends into the justice system. President Cyril Ramaphosa established a judicial commission to investigate criminal syndicates that have penetrated South Africa’s law enforcement and courts, following allegations by the KwaZulu-Natal police chief that exposed the depth of systemic corruption. The probe, known as the Madlanga Commission, was originally scheduled to deliver findings by the end of August. Its deadline was extended to November 16, pushing potentially sensitive conclusions past municipal elections on November 4.
Ballim views the commission’s delayed but ongoing work as potentially transformative. “While the probe has exposed the severity of South Africa’s institutional breakdown, it could be cathartic and foster a boost in investor confidence,” he said. The exposure of institutional failure, uncomfortable as it is, may paradoxically strengthen confidence by demonstrating that governance problems are being addressed rather than concealed.
Nearly 70% of the reforms Ramaphosa identified as priorities in 2020 are either on track or completed, providing a concrete baseline against which delivery can be measured. That figure matters because the credibility of the entire recovery trajectory depends on whether institutional improvements translate into reliable, predictable rule of law.
“Aggregate governance is improving,” Ballim said. “Capital is going to chase confidence. Confidence is going to hinge on the capacity for the rule of law to be substantial, predictable, and to hold.” The burden of sustained growth, in his framing, sits squarely with the government’s ability to deliver functional institutions and consistent enforcement, not with market sentiment or external conditions.
The stakes reach well beyond South Africa’s own borders. Ballim estimates that every one percentage point increase in South African GDP could lift gross domestic product across the southern continent by as much as 0.7%. “If South Africa does well, the region does well,” he said. “If there is one region that can really turn its dial, and turn the dial for the rest of sub-Saharan Africa, it is southern Africa, with South Africa at its core.”
Whether the Madlanga Commission’s November findings accelerate that dial, or complicate the political environment in which delivery must happen, is the question that will define the next phase of this recovery.