Executive summary

Growth has disappointed in the last few years. Weak consumer demand, persistently falling business investment, policy uncertainty, and the prolonged drought weighed on activity. While power production has improved, important bottlenecks remain in infrastructure and costs of services, which increase the cost of inputs for firms. The economic slowdown has pushed up the unemployment rate and income inequalities remain wide. Reviving economic growth is crucial to increase well-being, job creation and inclusivity. As there is limited room for monetary and fiscal stimulus, bold structural reforms, supported by social partners, are needed to unlock the economy.