The ANC cost South Africa 20 years

South Africa has effectively lost 20 years, with GDP per capita declining to levels last seen in the early 2000s as the country’s economy stagnates. 

Economic growth in the country has been consistently below the population growth rate, resulting in South Africans, on average, getting poorer every year. 

This is a recipe for disaster, with it leading to increasing social tension and discontent among citizens as their living standards decline. 

Making this worse is the wealth displayed by extremely rich individuals who tend to be politically connected and members of the government. 

This is feedback from Efficient Group chief economist Dawie Roodt, who said that destructive macroeconomic policies implemented by the ANC-led government have cost South Africa 20 years of economic growth. 

Speaking at the BizNews conference, Roodt explained that while South Africa’s economic fortunes are improving, it is not enough to make a meaningful difference. 

South Africa’s GDP figures for 2025, released this week, showed the country’s economic growth has doubled in the past two years to reach 1.1%. 

While this is a significant improvement, it remains too slow to make a meaningful difference to the country’s unemployment rate and the government’s strained finances. 

More importantly, it is still below South Africa’s population growth rate of 1.4% to 1.6%. This means that South Africans continue to get poorer on average. 

“The last time we were here, with regard to our GDP per capita figures, was 20 years ago. We have lost 20 years,” Roodt said. 

“Weak economic growth below population growth is a recipe for trouble. The Finance Minister expects this to improve, but it still won’t be enough.” 

This means that the country’s lost two decades are likely to continue for the foreseeable future, with significantly faster growth needed to rectify this situation. 

Apart from the average South African getting poorer, the economy is not growing fast enough to absorb new entrants into the labour force. 

While new jobs are being created, it is not at a sufficient rate to meet the expansion of the labour force, which is growing at around 600,000 entrants per year. 

As a result, South Africa’s unemployment rate is expected to continue to grow, with underlying labour market fragility being masked by statistical quirks as more individuals fall into the discouraged category. 

Wrong macroeconomic policies

The long-term drivers of these lost 20 years are the ANC’s failed macroeconomic policies that focus on the redistribution of wealth rather than the creation of it. 

These policies, ranging from an onerous tax regime to Black Economic Empowerment (BEE), have been coupled with the mismanagement of state-owned enterprises (SOEs). 

Roodt explained that this has made the country unattractive to both local and foreign investors, crippling economic growth. 

While the renowned economist admitted that things are looking better in South Africa, the impact on economic growth is likely to be muted by the government’s macroeconomic policy missteps. 

The government appears to be doubling down on these missteps by pursuing the National Health Insurance (NHI) scheme and expropriation without compensation. 

“Expect some growth, but, unfortunately, the real change in the economy is not happening yet because of the wrong macroeconomic policies,” Roodt said. 

“The wrong macroeconomic policies are things like expropriation without compensation. Things like BEE and even the NHI scheme.” 

Roodt also pointed out the vital role that local governments have in driving better economic outcomes, as they are responsible for much of the country’s basic service delivery. 

“The local authorities are not functioning. The state-owned enterprises are dysfunctional and have been destroyed financially and operationally by the ANC,” Roodt said.

As a result, while load-shedding has come to an end and Transnet’s performance has stabilised, South Africa’s economic growth has not accelerated meaningfully. 

Standard Bank explained in its recent financial results that much depends on the increased urgency in implementing the government’s stated reform agenda. 

The implementation of these reforms, which will increase private sector participation in the economy, boost investment, and cut red tape, is vital for faster economic growth. 

Should these reforms be delayed or not implemented fully, the bank warned that social unrest episodes are likely to increase amid rising discontent.