JOHANNESBURG, Oct. 3 (Xinhua) -- The World Bank downgraded South Africa's growth forecast for 2018 on Wednesday to 1 percent from 1.4 percent.
The World Bank also lowered South Africa's growth forecasts for 2019 to 1.3 percent from 1.8 percent and to 1.7 percent from 1.9 percent in 2020.
"Growth is expected to remain subdued in 2019, as domestic demand is constrained by high unemployment and slow growth in credit extension to households, and as fiscal consolidation limits government spending," the World Bank stated in its regional economic outlook for Africa.
"The higher growth in 2020 reflects the expectation that the government's structural reform agenda will gradually gather speed, helping to boost investment growth, as policy uncertainty recedes," World Bank noted.
The World Bank also believed South African president's economic stimulus package would not do much to kick-start the country's sluggish economy. The country recently announced an economic blueprint following figures that show the economy has entered a technical recession.
"The economic effect of the stimulus plan is likely to be limited, as it mostly consists of already committed public spending. However, planned reforms, including on mining regulation and utility pricing, will improve the business environment and encourage investment," said the World Bank.
World Bank said it expects economic growth in sub-Saharan Africa to pick up to 2.7 percent in this year from 2.3 percent last year, barely above population growth.
"The region's economic recovery continues but at a slower pace than expected," the World Bank said.
Meanwhile, South Africa's Reserve Bank deputy governor Daniel Mminele said on Tuesday the consumer inflation of South Africa could breach the 6 percent upper limit of Reserve Bank's target band.
