Cabinet Sees Positive Signs as South Africa's Economy Gains Momentum

According to Cabinet, the improved outlook signals that the domestic economy is becoming more stable and continues to demonstrate resilience.

South Africa's economic reform programme is showing encouraging signs, with stronger freight rail performance, major investments in manufacturing and a modest improvement in the country's growth outlook adding to confidence in the economy.

Briefing the media on the outcomes of the Cabinet meeting, Minister in the Presidency Khumbudzo Ntshavheni said Cabinet welcomed the International Monetary Fund's (IMF) decision to revise South Africa's projected GDP growth to 1.1%.

She said the revised forecast reflects growing confidence in the country's recovery despite slower global economic growth and continuing geopolitical tensions in the Middle East. According to Cabinet, the improved outlook signals that the domestic economy is becoming more stable and continues to demonstrate resilience.

Freight rail performance improves

Cabinet also welcomed improved operational performance by Transnet Freight Rail (TFR) during the first quarter of the 2026/27 financial year.

TFR transported 42 million tonnes of freight during the quarter, compared with 40.2 million tonnes during the same period last year, representing a 4.4% year-on-year increase.

Ntshavheni said the growth was particularly significant because it was achieved despite an additional 11-day scheduled maintenance shutdown on the Iron Ore Line. She noted that moving higher freight volumes under those conditions reflected better operational efficiency and stronger network performance.

Manufacturing investments create jobs

Cabinet highlighted major investments in the automotive sector as another positive signal for South Africa's industrial economy.

Toyota South Africa Motors is investing R10.4 billion in its Prospecton plant in eThekwini to manufacture the ninth-generation Hilux. The investment will support nearly 27,000 jobs across the supplier network while sustaining more than 4,300 direct assembly jobs at the facility.

Cabinet also welcomed the Chery Group's acquisition of the former Nissan manufacturing plant in Rosslyn, Gauteng. The company plans to manufacture Chery, Jaecoo and Jetour vehicles at the site, with production expected to begin in mid-2027 before expanding to an annual capacity of 15,000 vehicles.

The project secures 692 manufacturing jobs and is expected to create nearly 3,000 direct and indirect employment opportunities across logistics, engineering, supply chains and related services, further strengthening South Africa's role as a regional automotive manufacturing and export hub.

Trusted Employer Scheme enters digital phase

Cabinet also welcomed the launch of Phase II of the Trusted Employer Scheme (TES), which is designed to speed up visa processing for verified employers while maintaining immigration controls and national security standards.

Eligible employers must demonstrate meaningful investment in South Africa, prioritise the employment of citizens and permanent residents, invest in local skills development and operate in priority sectors of the economy.

Applications are now being accepted through the new Home Affairs @ Home online portal, which forms part of the government's wider digital transformation programme and is expected to evolve into South Africa's future Electronic Travel Authorisation (ETA) system. Expressions of Interest will remain open until 4 September 2026.