A broad-based reform to the SA education system is just the best way to boost growth in South Africa, says International Monetary Fund (IMF) which predicts the SA economy to remain below 1% in 2017.
The IMF left its growth expectations for South Africa at 0.8% in 2017 since its October report last year, but warned that the country will only get out of its economic status when it begins to consider changing its education policies.
Speaking at a press briefing on the update of the IMF’s world economic outlook on Monday in Washington, DC, deputy division chief at the IMF, Oya Celasun said the SA growth will “improve somewhat … to a still-weak pace of recovery of 0.8% and then improve a bit further” to 1.6% in 2018.
“So looking ahead, more inclusive labour market policies, more education, broad-based reforms to education are needed to boost growth,” said Celasun.
The SA education system has been reported in The Economist on 7 January 2017, to be one of the world’s worst, ranking 75th out of 76.
The report also has it that money is not the reason for the failure. It blamed it on the country’s a lack of accountability and the terrible quality of most teachers.
“Few countries spend as much to so little effect. Public spending on SA education system is 6.4% of GDP; the average share in EU countries is 4.8%.”
“More important than money are Central to both failures is the South African Democratic Teachers Union, which is allied to the ruling African National Congress,” it said.
Meanwhile, Celasun also explained that aside poor SA educational system, structural factors have also been weighing on growth and are projected to do so going forward.
These, according to her, include, power provision issues, which the authorities are addressing, but also an inadequate level and mix of skills in the economy, and more recently also policy uncertainty.
“So what’s allowing for higher growth will be better power provision, which was a factor holding back growth recently. Going beyond that it will also be the fact that macro policies will be shifting towards a more neutral stance from the contractive stance they’ve had and they are likely to have in the near term,” she added.
Hence, like rating agencies Standard & Poor’s, Moody’s and Fitch, the IMF said in its October report that growth prospects for South Africa will hinge on whether the country would be able to improve the efficiency and governance at its state-owned enterprises.