By nanaupdate | July 18, 2025
South Africans are getting poorer compared to the rest of the world—and slow economic growth is largely to blame. According to a new report by Investec Wealth & Investment International, the country’s sluggish performance since 2010 has severely impacted citizens’ income levels, with GDP per capita now well below the global average.
📉 The Numbers Don’t Lie
In 2023, South Africa’s GDP per capita (adjusted for purchasing power parity) was $15,194, compared to the global average of $22,850. That’s a massive gap that puts South Africans far behind their global peers in terms of economic well-being.
So, what’s holding the country back?
⚠️ Key Challenges Dragging the Economy
Experts point to a number of persistent issues:
- Frequent power outages (load shedding)
- Widespread corruption
- High crime rates
- Crumbling infrastructure
- Questionable foreign policy decisions
These challenges have collectively shrunk the South African economy by around 37% from what it could have been—if only it had kept pace with similar emerging markets.
🚀 What Would It Take to Catch Up?
To close the gap and match the global average in the next 10 years, South Africa would need to grow its GDP per capita by an ambitious 8% per year, according to Osagyefo Mazwai of Investec.
To put that into perspective:
- Middle-income countries have averaged just 5.9% annual growth since 1991.
- The global average is 4.4%.
Clearly, South Africa has a steep hill to climb.
📉 Low Confidence, Low Growth
Adding to the woes, the International Monetary Fund (IMF) recently downgraded its growth forecast for South Africa. The economy is now expected to grow by just 1% in 2025, down from an earlier estimate of 1.5%. Investec is even less optimistic, projecting only 0.9% growth next year—with a slow climb to 3% by 2030.
Meanwhile, business confidence remains stubbornly low, stuck below the 50-point level that typically signals growth, according to the Bureau for Economic Research.
💡 The Way Forward
Experts say South Africa must act fast and decisively. Restoring investor and business confidence through better policy implementation, infrastructure upgrades, and anti-corruption efforts will be key to turning the tide.
Until then, many South Africans may continue to feel the economic pinch—while their peers in other parts of the world move ahead.
