South Africans woke to a headline with a catch. The economy is officially 5 percent larger than previously stated, yet the country’s central bank governor, Lesetja Kganyago, has a blunt message for households: a bigger statistical economy does not put more money in anyone’s pocket.
The South African Reserve Bank Governor explained that the revised figures, produced after a recounting exercise by StatsSA, simply mean the country now has a better hindsight understanding of how the economy looks. For ordinary citizens, the exercise matters because many measures are calculated relative to the size of the economy. “The interesting thing is that this re-estimation also changes how the country is perceived as some of the measures are done relative to the size of the economy,” Kganyago said.
StatsSA has revised the benchmarks for GDP used to calculate the entire output of the economy, and it has moved the base year for comparisons from 2015 to 2022. The recounting takes place every five years to gain insight into what might have been missed in understanding how the economy is growing.
What does this mean for daily life? Growth remains modest by either official measure. The Reserve Bank’s September assessment put expansion at 1.2 percent this year, while the International Monetary Fund estimates 1 percent.
Kganyago, though, pointed to signs of resilience despite global pressures. “South Africa has turned a corner and had it not been for the war, the economy was actually accelerating,” he said. “The war found that South Africa has built defences that were able to cushion the economy.”
Those defences, he argued, have tangible effects on the cost of living. South Africa has a lower inflation target, its debt has stabilised and has now begun to decline, and the premium asked by foreigners to invest in the country has fallen. The Rand has also performed better in the aftermath of the shock, thanks to the buffers the country built.
The practical benefit shows up at the fuel pump. Fuel prices would have been higher without those buffers, and the Minister of Finance would not have been able to give South Africans relief from high fuel prices.
Still, the Governor acknowledged the strain on households is real. “As individuals we also have to adjust, I know that South Africans are experiencing pain from this,” he said.
Meanwhile, he praised the adaptability of citizens, noting that South Africans are resilient and are finding workarounds. He singled out the Department of Transport for applause, commending it for opening additional Prasa routes. Many international countries have public transport to buffer traveling costs, he observed, and he expressed hope that the newly opened corridors will go a long way to assisting the country’s commuters.
The full picture of the Governor’s remarks and the statistical revision is available in eNCA’s coverage, which can be read at https://www.enca.com/business-top-stories-videos/sa-economy-may-be-bigger-we-are-not-richer-kganyago.
For now, the message to the public is a measured one. The recounting offers a clearer, more accurate picture of the economy’s true size, but it does not change the underlying reality that growth remains modest, household budgets stay under pressure, and the buffers the country has built will keep deciding how sharply global shocks reach ordinary South Africans.