South Africa’s GDP shrinks 0.6 pc in Q3 of 2019
South Africa’s Gross domestic product (GDP) contracted 0.6 percent in the third quarter against a 3.2 percent expansion in the second quarter, Statistics South Africa said.
In the first quarter, S.A’s GDP contracted by 3.1% owing to nationwide electricity blackouts by state-owned power firm Eskom.
The economy slipped in the third quarter where mining, manufacturing and transport were the biggest drags on growth in GDP.
The economic challenge facing President Cyril Ramaphosa was laid bare as South Africa’s unemployment rate rose to its highest in more than a decade and the embattled state-owned Eskom power monopoly unveiled its biggest annual loss.
S.A which is Africa’s most industrialised nation, has been marred by joblessness having increased to 29 per cent in the second quarter, a 16-year high.
Manufacturing which is bigger than mining fell by 3.9 percent but its contribution to GDP was as large as -0.5 of a percentage point in both cases.
Mining was down by 6,1%, largely driven by a fall in the production of platinum group metals, coal and iron ore, whereas the transport, storage and communication industry also found itself on the back foot, falling by 5,4%.
The construction industry failed to pull itself out of recession, registering its fifth consecutive quarter of negative growth. Decreases were reported for activities related to residential and non-residential buildings, as well as construction works.
President Ramaphosa took office in 2018 with a promise of economic revival and is under pressure as signs of a slowdown are mounting and reforms face resistance in his own ruling African National Congress (ANC).