We must build on the momentum of our economic recovery

Dear Fellow South African,

As we enter a new year, the momentum of our economic recovery is gathering pace. In the last months of 2025, we saw a number of indicators that our collective efforts to rebuild our economy are bearing fruit.

The economy has posted four consecutive quarters of growth. There has been a steady reduction in unemployment, while recent data released by Statistics South Africa shows that levels of poverty and inequality have declined considerably. Confidence in our economy is rising, the stock exchange has been performing well and the average inflation rate is the lowest in two decades.

Late last year, South Africa exited the Financial Action Task Force grey list, which is an important signal of institutional improvement and a boost to investor confidence. We have also seen a sovereign credit ratings upgrade, reflecting strengthened fiscal credibility.

While these signs of progress are encouraging, there is no time to rest. The difference between a temporary lift in growth and sustained shift in our economic trajectory lies in expanding investment. With a strengthening currency and rising commodity prices, we have wind in our sails. Now we must steer our ship towards greater prosperity for all South Africans.

Last week, at its first meeting of the year, the Presidential Economic Advisory Council (PEAC) made clear proposals on how to achieve this goal. A body of respected local and international economists, academics and practitioners, the council provides strategic and evidence-based advice on policy decisions that promote economic stability, growth and inclusivity.

The council said that Government should translate recent positive developments into enduring growth by simultaneously boosting public infrastructure spending and lowering the cost of doing business.

Increasing infrastructure investment is not simply about spending more. It is about delivering projects that reduce the cost of doing business, unlock growth and create jobs.

Council members expressed strong support for the ongoing programme of structural transformation in key sectors such as electricity, logistics and water. These interventions, which have brought an end to load-shedding and improved rail and port performance, aim to enable competition, improve the efficiency of network industries and reduce costs across the economy.

Our electricity reforms are critical to this effort. A competitive electricity market is essential to bringing down the cost of electricity. And lower electricity prices are critical for both inclusive growth and social development. Similarly, improving logistics performance in rail, ports and freight corridors remains essential to exports, industrialisation and job creation.

In addition to boosting private investment, we need to achieve higher levels of public investment in infrastructure. Over the last few years, we have laid a solid foundation for investment by streamlining the regulations that have held back infrastructure projects, making it easier to pursue public-private partnerships, and establishing strong institutions such as Infrastructure South Africa and the Infrastructure Fund. We have committed more than R1 trillion of public funds for infrastructure projects over the next three years.

We need to build on this foundation by strengthening our state-owned enterprises and enabling them to invest at much higher levels.

We must do all of this at a time when the international environment is increasingly volatile and uncertain. Global growth is expected to remain subdued over the medium term and many countries are facing heightened trade and geopolitical tensions.

This underscores the need for South Africa to sharpen its competitiveness and expand markets, particularly on the African continent. We must capitalise on the positive momentum of recent months by building strong partnerships, strengthening delivery, and closing the gap between policy intent and implementation. Only if our own institutions are strong can we compete and remain responsive in a rapidly changing world.

During the course of this year, we need to double down on our efforts to grow investment and create jobs. We must seize the momentum we built and translate this into long-term gains for our economy.

In the coming days, Cabinet will hold its annual Lekgotla to outline the actions that will be taken across Government and with social partners to achieve these goals. Through these actions, by working together, we will ensure that the progress we’ve seen in the last year will have an impact on the lives of South Africans this year.

With best regards,

Cyril Ramaphosa is the President of South Africa