Statistics South Africa released the latest Gross Domestic Product (GDP) numbers today, and they’re not at all pretty.
Yup – we’re officially in a recession again.
2019’s third quarter saw the South African economy decline by 0,8%, and the fourth quarter numbers were even worse, showing a 1,4% decline.
A country is officially in a recession when the GDP falls for two successive quarters. This is the third time since 1994 that we’ve been in a recession, with the last occurring in the second quarter of 2018.
This below from Moneyweb:
Only three out of the eight production sectors contributed positively to the GDP with the largest negative contribution coming from the transport, storage and communication industry which decreased 7.2% contributing -0.6% of percentage growth.
The diminished economic activity was reported for land and air transport, as well as transport support services.
The second most notable dip is in the trade industry which contributed a 0.5% contraction to economic growth after decreasing by 3.8% due to a dip in economic activity in the wholesale and motor trade and accommodation.
Load shedding would have played a role, of course, but it’s not the only factor contributing towards these terrible numbers.
Here’s Joe De Jaco, the deputy director-general of Stats SA:
“We have had indications especially when you unpack the trade sector that the declines came from wholesale which is mostly linked to the drop that we see in imports,” he said.
“In the business services sector we still recorded positives which makes one think that load shedding might not have had such a big impact in this quarter,” De Jaco said.
I guess our politicians will have to find a different scapegoat.
These two graphs below come via Stats SA, with the first showing those two successive quarters:
Here’s a breakdown of how each industry performed during the final three months of last year:
Should we really stick the knife in? Across the four quarters (the whole of 2019, keep up), the economy grew by a paltry 0,2%.
Here’s how bad that is in context, with only 2009’s global economic recession ranking worse over the past 14 years:
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