South Africa's GDP growth forecast halved by Absa CIB to 1% amid global uncertainties

ABSA Corporate and Investment Banking (CIB) has slashed its 2025 GDP growth forecast for South Africa by half, from 2.1% to 1.0%, due to heightened global uncertainties. The updated outlook was presented in the South Africa Q2 2025 Quarterly Perspectives report on Wednesday.

- YOGASHEN PILLAY

Miyelani Maluleke, a senior economist at Absa CIB, said in Absa's Q1 Quarterly Perspectives, that they had forecast that real GDP growth could improve to 2.1% in 2025 supported by a combination of improved domestic infrastructure, household finances, higher levels of business confidence, recovery from drought conditions, and broadly stable global growth.

However, this forecast has now changed. "While some of these factors seem likely to remain supportive, others have deteriorated. We still expect real GDP growth to improve from 2024, but we revise our forecast to 1.0% for 2025. We also trim our forecast for 2026 to 1.4% from 2.1% previously," he said.

Absa CIB forecast overall investment growth of 1.9% in 2025 and 3.2% in 2026.