South Africa’s financial markets are enjoying a surprising rally, with the Johannesburg Stock Exchange (JSE) hitting record highs and the rand gaining strength against the US dollar. The surge comes even as exports face fresh pressure from 30 percent US tariffs on some goods. For many investors, it’s a bright spot in an economy that has otherwise struggled to find its footing.
Beneath the market gains, Africa’s most industrialised nation is still weighed down by years of stagnation. Growth has averaged just 1 percent over the past decade, and while the economy expanded by 0.8 percent in the second quarter of 2025 — its fastest pace in two years — it remains far short of the government’s ambitious 3 percent target. The central bank is more cautious, projecting only 2 percent growth by 2027.
Unemployment continues to be a heavy burden, sitting at 33.2 percent in the second quarter. Officials warn nearly 100,000 more jobs could be lost this year, with big names like ArcelorMittal, Goodyear, and Ford South Africa planning layoffs. The government says it will push to create 240,000 jobs in 2025, but many remain sceptical about whether reforms can match the scale of the challenge.
There are, however, small signs of progress. After years of crippling blackouts, power supply has stabilised, and upgrades at ports and the state freight company Transnet are beginning to ease trade bottlenecks. Still, analysts caution that reforms on paper must quickly translate into real results for businesses and workers. Until then, South Africa’s stock market rally may be a glittering distraction from a fragile reality.
