Strikes hit mining output: SARB

By Drum Digital
06 December 2012

Year-on-year economic growth halved to 1.2 percent mainly because strikes dampened mining output, the SA Reserve Bank quarterly bulletin reported on Thursday.

It said the real output of the mining sector contracted by 12.7 per cent in the third quarter of the year.

This compared to a strong quarter-to-quarter increase of 30.9 per cent in the second quarter of the year.

Towards the end of the quarter, labour unrest after the shooting at Lonmin Platinum's Marikana operations had spilled over to other mines.

Escalating cost pressures, subdued global demand and lower international commodity prices further aggravated the poor growth performance of the sector over the period.

When the first three quarters of 2012 are compared with the corresponding period of 2011, the real value added by the mining sector declined by 4.2 percent.

Pronounced declines were registered in the production of copper, chrome, nickel, platinum, gold and coal over the period. By contrast, production of iron ore and diamonds increased.

The lower growth rate also reflected a modest slowdown in agricultural production.

Growth in the real value added by the agricultural sector moderated from 9.3 per cent in the second quarter of 2012 to an annualised rate of 7.4 per cent in the third quarter.

Real output of the agricultural sector was mainly affected by a much smaller part of the 2011/12 maize crop being harvested as the bulk of the crop was harvested in the second quarter, the bulletin said.

The real value added by the manufacturing sector rose at an annualised rate of 1.2 per cent in the third quarter, following a decline of 0.8 per cent in the second quarter of 2012.

This was due to a rise in domestic demand and stronger export demand for certain things like textiles, clothing, leather and footwear; wood and wood products, paper, publishing and printing; basic iron and steel, non-ferrous metal products and machinery; and radio, television and communication apparatus.

Slower growth was recorded in the subsectors producing petroleum, chemical products, rubber and plastic products, motor vehicles, parts and accessories and other transport equipment.

Production contracted in the sub-sectors for food and beverages, glass and non-metallic mineral products and electrical machinery.

Real gross domestic expenditure decelerated from an annualised rate of 4,9 per cent in the second quarter of 2012 to three percent in the third quarter.

The deficit on the current account of South Africa's balance of payments with the rest of the world stayed the same at 6,4 percent of gross domestic product.

-by Sapa

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