The Archive

Articles

Accessible, evidence-based analysis on growth and inclusive development in South Africa.

Budget 3.0: Slower growth, higher debt, less expenditure, more work ahead

South Africa’s finance minister tabled a Budget on 21 May with the support of the Government of National Unity partners. VAT will remain at 15 per cent and Cabinet is agreed that reviews of expenditure should be intensified. The revised budget protects frontline services though several provisional spending proposals have been withdrawn. But the problems of sluggish growth and high debt levels remain. Substantial spending cuts will be needed if the Treasury’s fiscal consolidation goals are to be achieved. More rapid growth will require far-reaching structural and fiscal reforms.

28 MAY 2025

Innovation for inclusive growth in South Africa: The role of R&D policy in addressing inequality

Innovation has the potential to drive inclusive economic growth and reduce income inequality, yet, in South Africa, persistent gaps in R&D funding, patent accessibility, and unequal skills development limit its benefits. It is imperative for the government to review policy guidelines and make clear funding commitments to promote the equitable uptake of innovative technologies for wealth creation.

30 APR 2025

Fact AND Fiction – A comment on the 2025-6 Budget

The 2025-26 annual Budget has been subjected to an unprecedented degree of interrogation and deliberation. But two inter-related issues have not been debated with sufficient rigour: the overall economic strategy in the budget, and the proposed increase in Value Added Tax (VAT). The VAT debate has been based largely on conjecture and ideology, rather than on the actual evidence of the impact of VAT, and its role in the country’s larger economic strategy. I address these lacunae in the budget debate in two parts. Part A addresses economic strategy. Part B is focused on evidence on the impact of VAT in South Africa,

22 APR 2025

How have the returns to education evolved in post-apartheid South Africa?

Education contributes to improving living standards, primarily through the labour market. Using more than 20 years of harmonized microdata, this article shows how the size and nature of the returns to education have evolved in post-apartheid South Africa. Despite a substantial increase in educational attainment, the returns to education have increased. By benefitting lower-wage workers more, this has reduced wage inequality which, nevertheless, remains extremely high.

16 APR 2025

A crisis of abundance

In this opinion piece on South Africa’s unemployment crisis, Andrew Donaldson argues that while structural reforms are needed to raise growth and broaden development over the longer term, an employment-oriented economic strategy is the central challenge in present times.

27 MAR 2025

Can moving to a new city improve economic prospects?

Urban migration is reshaping South Africa’s economic landscape in ways that policymakers have yet to fully grasp. New evidence from the National Income Dynamics Study (NIDS) shows that intercity migration—moving between cities rather than from rural to urban areas—offers a powerful route to economic mobility. Ignoring these trends in urban policy could limit the country’s ability to create a more inclusive and regionally balanced economy.

25 MAR 2025

Consumers pay more when producer prices rise, but benefit less when they drop: price transmission asymmetry in the maize and wheat markets

Market competition plays a crucial role in ensuring fair pricing and economic efficiency within South Africa’s food industry. However, persistent price transmission asymmetry in staple food markets impacts negatively on consumer welfare. Despite existing regulatory frameworks, enforcement gaps allow dominant firms to exploit market power and manipulate prices to their advantage. This undermines fair competition and deepens economic inequality, making it essential to address price transmission asymmetries to promote a more equitable and efficient food market.

25 MAR 2025

South Africa to host BRICS+ Agricultural Investment and Trade Summit: why it matters

South Africa is due to host the BRICS+ Agricultural Investment and Trade Summit this year, which may be a significant step towards fostering sustainable agricultural development and enhancing trade relations among BRICS and allied nations. The summit will bring together policymakers, industry leaders, and investors, and specialists to discuss innovative solutions for food security, climate-resilient farming, and the future of agribusiness. By strengthening intra-BRICS cooperation and integrating new partners, the event aims to develop a more collaborative, sustainable, and technologically advanced agricultural sector that can drive economic growth and improve livelihoods in participating countries.

13 MAR 2025

Fiscal consolidation: facing up to reality

If tax increases are to be avoided in this year’s revised Budget, there will have to be clear commitments to expenditure adjustments. In this Econ3x3 opinion piece, former Treasury official Andrew Donaldson argues for proactive measures by the Treasury to reduce or curtail spending plans that are not currently subject to effective budgetary oversight

04 MAR 2025

Is South Africa spending enough on agricultural research?

Technological improvement is a primary catalyst for the growth of the South African agricultural sector. Thus, it is critical that the country continue to spend money on research and development to its long-term growth. However, in recent years, the country seems to be spending less. This is worrying, especially as the sector faces risks such as the consequences of climate change.

18 NOV 2024

South Africa must push agricultural exports within BRICS

South Africa has an export-led agricultural sector, with exports having been a major catalyst in the sector’s growth over the past three decades. But rising geopolitical tensions have introduced new risks, leading to an increased need for the country to diversify its export agricultural markets. In this article, we argue that South Africa should expand market access to some key BRICS countries, such as China, India, Egypt, and Saudia Arabia. Other strategic export markets for South Africa's agricultural sector include South Korea, Japan, Vietnam, Taiwan, Mexico, the Philippines, and Bangladesh. Currently, the significant challenges in these markets are high import tariffs and phytosanitary barriers.

22 OCT 2024

The Just Energy Transition and the labour market in South Africa

How will the Just Energy Transition affect livelihoods in households dependent on the coal industry in South Africa? Here is a measure of how many jobs depend on the industry and possible transition strategies.

30 AUG 2024

The role of Public Employment in the climate crisis

Public Employment Programmes can play a key role not only in alleviating the crisis of widespread unemployment. They can also be harnessed to help to combat a range of social and environmental challenges, including the effects of climate change.

05 JUL 2024