OECD Economic Surveys

South Africa's growth has been subdued over the past decade and boosting employment is a priority. Prudent macro-economic policies are a pre-requisite for growth. On the fiscal side debt sustainability would benefit from reinforced spending rules and a broader tax base as well as better allocating public spending notably through higher public investment. On the monetary policy side a lower inflation target could better support growth. Durably boosting growth and employment would require wide-spread structural reforms. Reducing regulation can spur business dynamism while enhanced public transport could better connect people to jobs. Despite recent improvements constraints on electricity supply remain a strong impediment to long-term growth. Boosting supply include higher renewable energy generation backed by a competitive wholesale market expanding the transmission grid and facilitating electricity distribution. Finally South Africa faces challenges in meeting climate commitments and gradually increasing the net effective carbon price will be key.