New thinking required in addressing SA’s economic challenges

An executive government’s legislative agenda, accomplishments and policy roadmap for the next session are outlined in the president’s state of the nation address (Sona). We must examine the existing state of the economy and growth issues to properly evaluate government priorities that come out of these speeches. This requires an economic analysis of SA from the perspective of the average citizen.

It is critical to have a comprehensive view of the past three decades of economic activity, employment rates and social services, as well as other variables. Since the establishment of democracy, the SA economy has undergone significant changes, despite enduring the after-effects of economic sanctions during apartheid. The minimum wage (SMI) rose 61% between 2018 and 2025, increasing purchasing power, and they enacted drastic labour changes, such as reducing temporary contracts.

The average yearly growth of 3.3% for the next 20 years was indeed a significant improvement over the 1.4% average growth that was observed between 1980 and 1993. Since 1994, SA has experienced mainly four recessions, some of which were technical. For the first time in 17 years because of the global financial crisis, the country entered a recession in 2008/2009. In 2018, the country entered a technical recession due to 10 years of stagnation and allegations of state capture.