South Africa’s economy grew 1.1% in 2025, missing expectations and underscoring the challenges facing President Cyril Ramaphosa’s administration in tackling a long list of urgent tasks amid geopolitical shocks.
Though expansion was the fastest in three years, Africa’s most industrialized economy has hardly grown in more than a decade, leaving it with crumbling infrastructure and the need to create jobs in a country where one in three are unemployed. The government has launched the biggest post-apartheid overhaul of the electricity and rail networks in a bid to attract private sector capital to tackle these challenges.
Further clouds are on the horizon: Nedbank, South Africa’s fourth-largest bank, warned that the Iran war “could again lead to a global supply-side shock,” which could “stoke inflation and force the central bank to reverse course.” The finance ministry already said this week it may have to revise its fiscal plan as a result of the conflict.
