BNP Paribas slashes SA’s 2020 economic growth forecast to -4%

JOHANNESBURG – BNP Paribas yesterday slashed South Africa’s economic growth forecast for 2020 to -4percent as the coronavirus pandemic continues to hurt global supply and demand channels.

In a research note, BNP chief economist Jeff Schultz revised South Africa’s gross domestic product (GDP) down due to the impending economic impact of Covid-19 and the country- wide lockdown.

Schultz said BNP now expected a negative contraction in the South African economy, versus -1.2percent previously.

“We now expect the economy to contract 4percent in 2020, which is 2.5 percentage points lower than the growth contraction recorded in the wake of the 2008/2009 global financial crisis,” Schultz said.

“We see GDP picking up towards 2percent in 2021, though mainly on base effects and acknowledging the risk that the slowdown in global activity lasts longer, as it takes time for consumer behaviour to normalise and global value chains and companies to rebuild themselves.”

Source: iol.co.za