Economic reform drive shows signs of traction, Cabinet briefing hears

South Africa's economic reform programme is beginning to bear fruit, buoyed by rising freight rail volumes, fresh investment in the automotive industry, a stronger manufacturing base and a modest but symbolically important upgrade to the country's growth outlook.

Briefing journalists in Pretoria on Thursday on the outcomes of Wednesday's Cabinet meeting, Minister in the Presidency, Khumbudzo Ntshavheni, said the International Monetary Fund's revised forecast – lifting South Africa's projected GDP growth to 1.1% – had been welcomed by Cabinet as evidence that the recovery was taking hold.

"While the upward revision to South Africa's economic growth forecast remains modest, it reflects growing confidence in the country's economic recovery efforts despite weaker global growth and geopolitical tensions in the Middle East," Ntshavheni said.

She added that Cabinet viewed the IMF's adjustment as confirmation of "a stabilising domestic economy that continues to demonstrate resilience".

Transnet Freight Rail delivered a 4.4% year-on-year improvement in the first quarter of the 2026/27 financial year, moving 42.0m tonnes of cargo against 40.2m tonnes in the same period last year.

The gain came despite an extra 11-day scheduled maintenance shutdown on the Iron Ore Line.

Ntshavheni said the higher tonnage in spite of the additional downtime pointed to a "significant improvement in operational efficiency and throughput" at the state freight operator.

Cabinet also welcomed a R10.4bn investment by Toyota South Africa Motors in its Prospecton plant in eThekwini, which will produce the ninth-generation Hilux. Ntshavheni said the investment underpins South Africa's automotive manufacturing base, sustaining more than 4,300 direct assembly jobs at the plant and supporting close to 27,000 jobs across the broader supplier network.

The announcement follows the Chery Group's acquisition and revamp of the former Nissan manufacturing site in Rosslyn, Gauteng, where the company plans to build vehicles under its Chery, Jaecoo and Jetour brands. Production is expected to begin in mid-2027, ramping up the following year to an annual output of 15,000 units.

Ntshavheni said the Chery deal secures 692 existing manufacturing jobs and is projected to generate close to 3,000 further direct and indirect roles in logistics, engineering, supply chains and support services. Taken together, she said, the Toyota and Chery investments "solidify South Africa's position as a robust manufacturing and regional export hub".

Cabinet further signed off on the launch of phase two of the Trusted Employer Scheme, a mechanism designed to fast-track visa processing for verified employers while maintaining national security and immigration safeguards.

Ntshavheni said employers wishing to qualify must show significant domestic investment, prioritise hiring South African citizens and permanent residents, invest in local skills development, and operate within priority economic sectors.

Applications will run through a new online portal, Home Affairs @ Home, which forms part of the government's wider digital transformation strategy. Ntshavheni said the platform would eventually feed into the country's full Electronic Travel Authorisation system.

Employers wishing to take part may submit expressions of interest between 20 July and 4 September 2026.

SOURCE: SAnews.gov

PHOTO CREDIT: Daily Investor