The interim Chief Executive Officer of Absa Group Ltd., Charles Russon, has emphasized the need for policy certainty and macroeconomic consistency to drive economic growth in South Africa. Speaking in an interview on Bloomberg TV, Russon urged policymakers to use the upcoming national budget announcement to create a stable and predictable economic environment that will encourage investment and expansion.
South Africa’s Growth Challenges
Russon highlighted that investors are seeking fiscal stability and a clear economic direction before committing to long-term investments. South Africa’s economy has struggled with less than 1% annual growth over the past decade, plagued by corruption, mismanagement, and repeated state bailouts for underperforming entities.
Finance Minister Enoch Godongwana is set to make a second attempt at presenting a national budget that satisfies a fractious coalition government. The failure of the first attempt raised concerns about the future of investment in South Africa if a solid fiscal plan is not approved.
For meaningful progress, the budget must address debt reduction, curb wasteful spending, and demonstrate responsible fiscal management, Russon stressed. He also noted that South Africa has the potential to achieve 2% economic growth in 2025 and 2026, but this would require immediate fiscal certainty and economic reforms.
The delayed budget process forced the government of national unity to negotiate and work toward a common agreement. Following an election that failed to produce a clear winner, the African National Congress (ANC)—which has governed South Africa since 1994—was compelled to form alliances with centrist opposition parties to maintain control.
Absa Eyes Expansion into Dubai
Beyond South Africa’s domestic economic concerns, Absa is exploring expansion opportunities in Dubai, reflecting a broader effort to strengthen trade and investment ties between Africa and the Middle East.
Russon explained that Gulf Cooperation Council (GCC) nations have been increasing their investments in Africa as part of efforts to diversify their economies. Key areas of interest include food security, renewable energy, and infrastructure development.
“We want to connect the rest of the world to Africa and facilitate business opportunities across continents,” Russon stated.
If Absa moves forward with its Dubai expansion, it will compete with Investec Ltd., which opened an office in the emirate last year, and Standard Bank Group Ltd., which already has a presence in Dubai and is planning further expansion into Egypt.
With domestic policy stability and global expansion efforts, Absa aims to play a leading role in South Africa’s economic recovery and Africa’s broader financial integration.
