IMF report says optimism in SA economy fading

JOHANNESBURG - A report authored by International Monetary Fund employees says initial optimism in the South African economy is fading.

It says economic recovery plans face serious constraints with the growing debt of state-owned enterprises.

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The report said, "some of the initial optimism has dissipated as growth remains stuck in low gear and reform implementation has faced constraints."

It was not all bad news as they named positive reforms, "economic reforms in a number of areas, in particular, strengthening the finances of state-owned enterprises (SOEs), reducing the cost of doing business, and increasing competition are proceeding, albeit slowly."

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"The recent investment conference between government and businesses ––domestic and international––on unlocking the vast investment opportunities is welcome."

The report said the amendment to the Constitution allowing for expropriation without compensation should be considered carefully.

They named labour concerns, ease of doing business, and the current condition of state-owned enterprises as risks that should be addressed.