GDP growth slows

2013-05-28 13:26

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Real gross domestic product (GDP) increased by 0.9% in the first quarter of 2013, Stats SA has said.

The increase in GDP was lower than the 2.1% achieved in the fourth quarter of 2012. However, when compared with the first quarter of 2012, GDP increased by 1.9%.

Main contributors to the increase in economic activity in the first quarter of 2013 were the mining and quarrying industries, finance, real estate and business services, which each contributed 0.7%.

General government services contributed 0.3%, while the wholesale, retail, motor trade, catering, accommodation, transport, storage and communications industries each contributed 0.2%.

Sectors which experienced declines were manufacturing at -1.2%, and agriculture, forestry, fishing, electricity, gas and water, each on -0.1%.

Nominal GDP at market prices in the first quarter of 2013 was R814 billion – R1 billion less than the fourth quarter of 2012.

Finance, real estate and business services expanded by R7 billion to R161 billion in the first quarter of 2013.

Agriculture, forestry and fishing expanded by R4 billion to R14 billion.

The construction sector grew by R4 billion to R31 billion.

Wholesale, retail and motor trade, and catering and accommodation decreased by R15 billion to R115 billion.

Transport, storage and communications declined by R5 billion to R63 billion.

Mining and quarrying decreased by R3 billion to R63 billion.

Stats SA deputy director-general Joe de Beer said it was too early to predict that 2013 would have low economic growth.

“The first quarter of 2013 is definitely lower than the last quarter of 2012. But it is a bit early to base the prediction of the entire 2013 just on the numbers of the first quarter,” he said.

“It could very well be that the growth in the second and the third quarters will be much higher than what you recorded in the first quarter of 2013. Analysts must be very careful to presume that the rest of the year will be as slow as the first quarter of the year was,” De Beer said.

However, he agreed that “most people will agree that it is a disappointing number”.

There was a link between GDP growth and job creation.

“If a manufacturer wants to increase his production, you may immediately hire people, and then you see an increase in production, a month later or six months later.”

However, there were also differences between industries. Some were very labour intensive, while others were capital intensive.

“If you are in an industry that uses machinery and equipment, you are able to change your production and output without changing your labour.

“Also, in industries such as manufacturing, you may be using just 75% of your production capacity. You can increase production without new labour,” he said.

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