Key Points:
- South Africa’s GDP grew by 0.6 percent in 2023, avoiding a technical recession.
- CEOs highlight job creation, state capacity, and public-private partnerships as economic solutions.
- Discovery CEO Adrian Gore advocates for economic growth and transparency to boost the economy.
Adrian Gore, CEO of Discovery, recently shared his insights on how South Africa can boost its economy during an episode of “The Money Show with Bruce Whitfield.”
Despite a 0.6-percent GDP growth in 2023, the country narrowly avoided a technical recession, and GDP per capita lagged behind population growth. Gore, along with other top CEOs, emphasized job creation, improving state capacity, and fostering public-private partnerships as key strategies to enhance economic growth and stability.
Despite these challenges, South Africa’s economy is expected to improve in 2024, with Bank of America economist Tatonga Rusike forecasting a GDP growth of 1.3 percent. Other analysts predict around 1 percent growth this year.
In a recent episode of The Money Show with Bruce Whitfield, Discovery CEO Adrian Gore, Standard Bank CEO Sim Tshabalala, and Investec Bank CEO Cumesh Moodliar discussed what could save the South African economy. Each executive offered insightful solutions to propel economic growth.
Adrian Gore, Discovery CEO
Adrian Gore, a prominent voice in the discussion, highlighted the resilience of South Africa’s economy, noting that it avoided a recession in 2023 despite heightened load shedding. However, Gore stressed that job creation through economic growth is crucial. He pointed out that when the economy grows at 3 percent or more, there’s only a 0.7-percent increase in jobs, while a stable or 1 percent growth results in a contraction.
Gore suggested that the Presidential task team Operation Vulindlela should establish a unit focused on economic growth and jobs. He also highlighted the positive impact of transparency on government plans, which can act as a “defibrillator” for the economy.
Sim Tshabalala, CEO Standard Bank
Sim Tshabalala agreed with Gore on several aspects, adding that the state needs to be capacitated and work closely with civil society and businesses to accelerate growth. He advocated for the acceleration of the Public Service Amendment Bill, which would introduce transparent and competitive recruitment processes in the public service, improve pay, and elevate the status of civil servants. Tshabalala cited Singapore as a model for this approach.
Cumesh Moodliar, CEO Investec Bank
Cumesh Moodliar called for greater public-private partnerships (PPPs). With South Africa’s debt-to-GDP ratio over 74%, the nation is limited in its ability to raise capital on international markets. Moodliar proposed integrating private capital into PPPs, pointing to successful examples like the Gautrain and some toll roads.
Moodliar emphasized that PPPs in renewable energy projects, rail, and ports could yield significant benefits. He explained that South Africa’s manufacturers, producers, and miners need mobility to export products and maintain employment levels. “PPPs lead to infrastructure development, job creation, innovation and technology transfer, skills transfer, improved service delivery, and ultimately revenue generation,” said Moodliar. “All these elements together drive the economic flywheel.”
The insights shared by these top CEOs underscore a multifaceted approach to reviving South Africa’s economy, emphasizing job creation, state capability, and strategic partnerships.
