SA economic growth lowest since 2009 recession

2014-02-25 15:52

Economic growth in 2013 fell short of projections from the International Monetary Fund (IMF) and the SA Reserve Bank.

Both institutions had late last year forecast annual growth of 2%, but Stats SA today released figures showing the year’s economic growth, in constant 2005 rand terms, came in at 1.9% – the lowest since the 2009 recession when it was -1.5%.

This brought the South African GDP in 2013 to R3.385?trillion at current market prices.

The growth rate compares badly to 2012’s 2.5% and 2011’s 3.6%, but there was some light at the end of the tunnel as key sectors rebounded in the last quarter of the year.

Some commentators were surprised after projecting even lower growth for the year as a whole and the last quarter in particular.

The seasonally adjusted and annualised growth rate in the last quarter of the year came in at 3.8% – higher than just about any forecast.

This measures the growth in production against the previous quarter as opposed to against 2012.

The rate was driven up by manufacturing and mining which contributed 1.8 and 0.8 percentage points, respectively. The manufacturing sector’s production in the last quarter was 12.3% higher than in the previous quarter on an adjusted and annualised basis, according to Stats SA.

This probably reflects the sector’s recovery from strikes in the third quarter.

For mining, the jump was 15.7%, which will probably be sharply reversed in the next set of GDP numbers owing to the current platinum strike.

In unadjusted terms, the real GDP growth in the last quarter was 2% higher than in 2012’s last quarter, slightly lifting the year’s total.

Year to year, the main contributor to higher GDP was the broadly defined financial, real estate and business services sector, which contributed 0.5 of the 1.9%.

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