With the mounting problems facing South Africa, CNBC looks at the investment case for the country and whether its economic outlook is starting to look bleak.
Last Thursday, the South African Reserve Bank cut its benchmark interest rate for the first time in five years, dropping the rate by 25 basis points to 6.75 percent in an effort to avoid a recession.
"Domestic growth prospects have deteriorated further following the surprise GDP contraction in the first quarter of 2017. The economy has now recorded two successive quarters of negative growth, and although a near-term improvement is expected, the outlook remains challenging," said the central bank's Governor Lesetja Kganyago, according to a Reuters report.
The central bank revised down its growth forecasts for country; it estimates 2017 full year GDP growth of 0.5 percent, down from 1 percent. Kganyago warned that underlying demand in South Africa's economy is extremely weak, adding that it is unclear whether any drivers of economic growth will emerge in the absence of structural initiatives that would reduce uncertainty and boost confidence.
"Policy uncertainty, a recent example being in the mining sector, is likely to constrain investment," he added.