South Africa: Economy dealt multiple blows as power crisis prevails

By Ray Mwareya

Posted on Wednesday, 15 March 2023 15:34
View of South African utility Eskom's electricity pylons during dawn as frequent power outages implemented by Eskom due to its aging coal-fired plants continue, in Johannesburg, South Africa, February 25, 2023. REUTERS

Fears abound over South Africa’s economic downturn as Standard and Poor’s (S&P) has lowered its credit ratings to ‘stable’ and forecasted a growth rate of a mere 1% – the lowest in almost three decades. A current account deficit was also reported for the first time in years in Africa’s most industrialised nation, which has been plagued with a chronic power crisis ravaging numerous sectors.

“South Africa’s rainbow effect from 1994 has surely been squandered. We have not done enough for nearly three decades to create an environment that encourages businesses,” says Steven Koch, a senior economics professor at the University of Pretoria in the capital and a former director of the African Finance & Economics Association.