All data is delayed
See More

Eastern Cape growth surprises

Oct 05 2012 11:00
Edward John Bottomley
Cape Town - economist Mike Schüssler has labelled growth in the Eastern Cape “a surprise”.

According to the Sake24 provincial barometer for this province, the Eastern Cape’s growth index rose 5.3% yea- on-year (y/y) and 20.9% compared with the previous three months.

“Manufacturing was a healthy 5.6% up on last year, thanks to higher vehicle sales,” said Schüssler, who compiles the barometer.

In recent months vehicle sales have risen nationally and this index for the Eastern Cape was 0.7% up on the previous three months.

“But I simply cannot understand the tremendous rise in construction,” said Schüssler. The Eastern Cape construction index rose a significant 40.6% y/y and 14.9% compared with the previous three months.

“This is despite the housing market not really being active,” said Schüssler.

According to him retail sales, especially vehicle sales, will continue to drive the Eastern Cape economy for a considerable time.

“But I am worried about how long the demand for vehicles will remain this strong. Take a look at airport traffic as an indicator; it's down for the 14th successive month.

“The Eastern Cape must quickly create a tourism base. It has to accelerate construction in this regard to counter a potential decline in vehicle sales.

“And I am concerned that the manufacturing sector will be unable to continue its momentum.”

But the good news is that the province’s agricultural industry is in a favourable position, thanks to good weather and higher prices.

The grain production sub-index rose an astounding 88% compared with a year ago. The agricultural index as a whole was 7.6% up y/y and 4% compared with three months ago.

“The meat index was down, but only slightly. That’s not a warning sign,” said Schüssler.

“For the next 18 months the agricultural industry  in this province has better prospects than many other sectors.

“It seems that the interior will have a difficult season, and cost pressures will start to have an impact on prices.”

Another success story is that of communications, which includes broadband penetration and internet access. This sector is included in the transport index, which rose 12.9% compared with the previous year.

According to Schüssler there is still great potential for internet and broadband services growth in the Eastern Cape, especially compared with provinces like Gauteng and the Western Cape, which are more saturated.

He believes it’s now clear that data is driving growth in the country’s communications.

Nationally, the communications index was 22% up on a year ago.

 - Sake24

For more business news in Afrikaans, go to

*Follow Fin24 on Twitter, Facebook and Google+.

eastern cape  |  sa economy  |  barometers



Read Fin24’s Comments Policy publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Company Snapshot

We're talking about:


Marketing is a big concern in SA's small business community, followed by a lack of confidence and partnering with the wrong people, according to a survey.

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

The 25 basis points interest rate increase is:

Previous results · Suggest a vote