South Africa must build on the momentum of its economic recovery, and expanding investment is the key to a sustained shift in the country’s economic trajectory, President Cyril Ramaphosa writes in his latest weekly newsletter.

He highlights four consecutive quarters of growth, a steady reduction in unemployment and recent data from Statistics South Africa showing that levels of poverty and inequality have declined, as indicators of economic recovery.

“Confidence in our economy is rising, the [JSE] has been performing well and the average inflation rate is the lowest in two decades,” Ramaphosa acclaims.

He also cites the country’s exiting of the Financial Action Task Force grey list last year, as well as a sovereign credit ratings upgrade by S&P Global as positive developments.

Meanwhile, the World Economic Forum (WEF) last week provided a prominent platform for South Africa to demonstrate the results of its reform story, business organisation Business Leadership South Africa CEO Busi Mavuso writes in her latest weekly newsletter.

Finance Minister Enoch Godongwana led a delegation of Ministers, leaders of industry and State agencies to the 2026 WEF meetings in Davos, Switzerland.

“When we came here in 2025, we presented our ambitious plan for driving economic reforms, building investor confidence and mobilising private investment. We returned in 2026 with concrete evidence of our progress. We returned not with promises, but with real successes,” the Minister highlighted.

Mavuso emphasises the importance of this credibility. “When international investors assess country risk, delivery on commitments moves a country from ‘interesting potential’ to ‘viable investment destination’.

“The 98% reduction in loadshedding between 2023 and 2025, combined with improved fiscal discipline delivering consecutive primary budget surpluses, provides evidence that South Africa can execute complex reforms,” she explains.

FURTHERING GROWTH

Godongwana indicated that government would deliver on its commitment to stabilise debt in the current fiscal year, showcasing its commitment to the macroeconomic stability and consistent policy execution needed to create an environment for higher local and global investment.

He also noted that the recent lowering of the inflation target would contribute to reducing costs across the economy and providing policy and price certainty for investors.

Meanwhile, the Presidential Economic Advisory Council (PEAC), at its first meeting of the year last week, said that government should translate recent positive developments into enduring growth by simultaneously boosting public infrastructure spending and lowering the cost of doing business.

A body of local and international economists, academics and practitioners, the PEAC provides strategic and evidence-based advice on policy decisions that promote economic stability, growth and inclusivity.

“Increasing infrastructure investment is not simply about spending more. It is about delivering projects that reduce the cost of doing business, unlock growth and create jobs,” Ramaphosa explains.  

PEAC members expressed strong support for the ongoing programme of structural transformation in key sectors such as electricity, logistics and water, he points out.

These interventions aim to enable competition, improve the efficiency of network industries and reduce costs across the economy.

Ramaphosa emphasises electricity reforms as pivotal to this.

“A competitive electricity market is essential to bringing down the cost of electricity. And lower electricity prices are critical for both inclusive growth and social development. Similarly, improving logistics performance in rail, ports and freight corridors remains essential to exports, industrialisation and job creation,” he avers.

South Africa also requires increased public investment in infrastructure, the President indicates.

“Over the last few years, we have laid a solid foundation for investment by streamlining the regulations that have held back infrastructure projects, making it easier to pursue public-private partnerships, and establishing strong institutions such as Infrastructure South Africa and the Infrastructure Fund. We have committed more than R1-trillion of public funds for infrastructure projects over the next three years,” he says.

Ramaphosa advocates building on this foundation by strengthening State-owned enterprises and enabling them to invest at much higher levels.

“We must do all of this at a time when the international environment is increasingly volatile and uncertain. Global growth is expected to remain subdued over the medium term and many countries are facing heightened trade and geopolitical tensions.

“This underscores the need for South Africa to sharpen its competitiveness and expand markets, particularly on the African continent. We must capitalise on the positive momentum of recent months by building strong partnerships, strengthening delivery, and closing the gap between policy intent and implementation. Only if our own institutions are strong can we compete and remain responsive in a rapidly changing world,” he outlines.

With the global order shifting, Mavuso calls for the country to be strategic and selective about international partnerships, evaluating every trade agreement and investment opportunity against clear criteria.