CAPE TOWN, June 6 (ANA) – National Treasury said on Thursday the confirmation that the country has entered a recession would force a downward adjustment of its growth forecast of 1.3 percent and put pressure on service delivery.
“The worse-than-expected GDP outcome introduces significant downward bias to the GDP growth estimates communicated in the 2017 budget review, which projected 2017 GDP growth at 17 percent,” it said after Statistics South Africa said growth contracted by 0.7 percent in the first three months of the year.
The figures signalled that the sustainability of the fiscal framework was at risk as well as government’s ability to deliver social services, the treasury added.
It said Finance Minister Malusi Gigaba would seek a meeting with business leaders to discuss ways of achieving inclusive growth.
South Africa was last in recession in 2009.
– African News Agency (ANA)