Unemployment, poverty and inequality are macroeconomic policy issues. But last week the ANC met for four days at its first National General Council (NGC) in a decade and did not bother to discuss macroeconomic policy. Looking back at three decades of ANC conference resolutions, the section on macroeconomic policy is always the shortest.
In December 2022, the 55th national conference’s resolutions on the economy did not have a single macroeconomic policy target. Therefore there was nothing to review at the 2025 NGC. The Treasury and the Reserve Bank — and nobody else — have the macroeconomic policy tools to grow the economy and create jobs. The presentation of the ANC’s economic transformation committee to the NGC was a mess. It provided no vision for the economy and was full of unnecessary detail.
From 2009 to 2024, South Africa had an average annual GDP growth rate of 1.1%. By comparison, the IMF says, 155 emerging and developing countries cruised to an annual average of 4.4% over the same period. Emerging and developing Asia (30 countries) had a rate of 6.3%. By the end of 2025, South Africa’s GDP per capita will be lower than it was in 2007. Such chronically low GDP growth for so long is not normal for a country that is not at war.
South Africa has the second-highest unemployment rate in the world. During the third quarter of 2025, there were 12.5-million unemployed people, according to Stats SA. The unemployment rate was 42.4%. Stats SA found that 40.8-million people — 66.7% of the population — lived below the upper bound poverty line of R2,635 per month in 2023. The World Inequality Report 2026 found that the richest 10% held 86% of wealth and the top 1% held 55%. The bottom 50% had negative net wealth. The establishment commentariat wants the public to celebrate the 0.5% GDP growth rate during the third quarter of 2025.
The economy has turned the corner and there are green shoots, they say. But this discourse relies on vibes and provides no evidence that there is a recovery. Last week, the IMF forecast 1.3% GDP growth for 2025 and 1.4% for 2026.
The economy has turned the corner and there are green shoots, they say. But this discourse relies on vibes and provides no evidence that there is a recovery. Last week, the IMF forecast 1.3% GDP growth for 2025 and 1.4% for 2026. The ANC’s solution to the macroeconomic crisis is to double down on the government’s failed microeconomic policies.
Economist Asghar Adelzadeh says: “Advocating microeconomic policy reforms to overcome the macroeconomic crisis is a convoluted and inappropriate approach. It is like using brain surgery instruments to conduct heart surgery.” Structural reforms are code for privatisation, deregulation, liberalisation and the withdrawal of the state from network industries — electricity, transport, telecommunications and water.
In 2020, the government set up Operation Vulindlela to implement and monitor the neoliberal structural reforms. Five years later, there are no results to show.
If Vulindlela has been such a success, why has there been declining gross fixed capital formation (GFCF), a measure of investment, in seven of the last nine quarters? Nedbank says GFCF will decline 1.5% in 2025, less than the 3.9% decline in 2024. “Underlying conditions remain unsupportive of a broad-based upturn in investment activity,” the bank says. In 2024 GFCF was R1.1-trillion, equivalent to 14.5% of GDP. The annual shortfall to achieve the National Development Plan’s (NDP) target of 30% of GDP is R1-trillion a year. The annual shortfall to achieve the NDP target for public investment of 10% of GDP is R500bn a year.
Against these targets, private investment in network industries is a joke. Over the next three years, there will be renewable energy and battery energy storage independent power producer projects worth R122bn or R40.6bn a year. Nedbank says: “Momentum will likely slow in the near term. Capacity constraints within the national grid and limited transmission infrastructure have started to weigh on new project activity.”
From 2025 to 2029, the National Transmission Company will invest R112bn in the grid or R22.4bn a year. It is not clear how much of this tab the private sector will pick up. In September, Transnet awarded 11 train operating companies access to 41 routes across six corridors. James Holley, the CEO of rail operator Traxtion, says each slot will require a minimum of R250m and a maximum of R1.2bn, which is the range of costs of a train set.
Traxtion, which did not participate in the new slots, has announced a R3.4bn rolling stock investment. But the constraints to this programme are the shocking state of the rail network, which has a R200bn backlog and the availability of rolling stock. Finally, International Container Terminal Services will invest R11.2bn in a joint venture with Transnet to upgrade Durban Container Terminal Pier 2. It is clear that the math of the structural reforms is not mathing. If it wants to reverse its electoral collapse, the ANC must seriously debate new macroeconomic policies that can revive the economy.
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