Gambling is threatening SA’s economy in the long run as it is shaping consumer behaviour and spending patterns, John Manyike, head of financial education at Old Mutual, said on Thursday.
Manyike was speaking at a media session following the release of the financial group’s mid-year economic outlook.
“We’re seeing an explosion of gambling in SA,” he said, adding certain food sectors had reported fewer customers, as people were increasingly gambling away their disposable income as a way to survive.
“I think we may be underplaying the socioeconomic impact of gambling. Yes, we do need to recognise the fact that the gambling sector may be providing more than 30,000 jobs, [and] contributing towards our GDP, but we do need to find a way to manage the scourge of people becoming addicted to gambling, because it can certainly harm the economy at a later stage,” he said.
Gambling makes up about 1% of SA’s GDP and contributes roughly R5bn to the fiscus.
“It is certainly shaping the consumer behaviour and spending spending patterns in SA,” Manyike said.
To address this, he suggested increasing investment in consumer education, adding that “[gambling] companies themselves need to set aside at least a percentage of their profits towards this consumer awareness about gambling, and also put some counselling and rehabilitation of people who find themselves addicted to gambling.”
Business Day recently reported that Famous Brands, in its annual report, noted that online gaming platforms had become a major force influencing consumer behaviour.
“In 2023, R1.1-trillion was wagered by consumers in the SA gambling industry, 40.2% higher than in 2022. Total revenue generated from gambling was R59.3bn. Of this revenue, 60.5% is attributed to betting, which is largely dominated by online players,” the report says.
Old Mutual’s mid-year outlook
On a more positive note, Old Mutual chief economist Johann Els’ key message in the mid-year outlook was that SA’s long-term growth trend is improving, albeit from a low base.
Following more than a decade of sluggish performance — where the economy expanded by just 1.1% on average between 2009 and 2024 — Old Mutual now projects growth will average 2.5% to 3% over the medium term, “on the back of significant private sector participation in the economy,” Els said.
“We are making some headway into reducing the structural constraints in the economy.”
That, he said, would make a positive difference, “especially in an environment where there’s a risk on trade, where investors are wary of investing in the US and more looking towards emerging economies”.
According to Els, SA stands to benefit. “Foreign investors are always looking at stable countries.”
However, Els cautioned that growth levels of 5-6% — often considered necessary to create meaningful employment gains —remained "highly unlikely" without radical structural reform.
“Highly unlikely, in my mind, is the same as never,” he clarified.
Near-term projections suggest some improvement in the second half of 2025.
Old Mutual expects GDP growth to gradually accelerate from 1.3% in 2025 to 1.5% in 2026, rising further to 2.2% in 2027 and 2.5% by 2028, reflecting a slow but steady recovery in economic momentum.
Consumer inflation is forecast to remain contained over the medium term, averaging 3.3% in 2025 before edging up to 4.2% in 2026. Thereafter, it is expected to moderate again, easing to 3.5% in 2027 and 3.0% in 2028.
Responding to a question about how markets will react when the US tariffs take effect on August 1, Els said he did not expect a significant effect.
“We’ve admittedly seen some volatility, but I think to the large extent that’s been priced into most of the financial areas of the markets.”
Els also forecasts one more interest rate cut this year.
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