Bloemfontein – In recent months the KwaZulu-Natal economy
has slowed slightly, as shown by the Sake24 and BoE Private Clients
KwaZulu-Natal Barometer.
This can be partly ascribed to the province's exposure, via
its ports, to the slow growth in the global economy.
"Although KwaZulu-Natal is growing more slowly, there
is no impending recession on the horizon," said Mike Schüssler of
Economists.co.za, who compiled the barometer.
The overall index was 7.1% up year-on-year (y/y) in February
– the lowest increase in 16 months. The barometer's growth index slowed to 4%
after having grown by more than 8% in the first half of last year.
Growth still on track
With the exclusion of agriculture (5.6% down on the previous
year) and financial, property and business services (7.9% down), all the other
economic sectors still showed positive growth.
The outperformer, as usual, was the transport and
communications index (14.5% up on a year ago).
This is the 33rd successive month that this index has grown,
mainly owing to the big increase in cellphone minutes and internet use
countrywide.
The number of passengers passing through King Shaka airport
was just 1.2% up compared with the same month last year, and Schüssler said the
demise of the KwaZulu-Natal low-cost airline Velvet Sky will affect this figure
even more.
The amount of freight moving through the ports was 2.2% up
y/y and the growth is expected to remain low, in keeping with the global
economy's sluggish showing.
Over the next five years the provincial transport economy
will probably derive considerable benefit from the R5bn that the Passenger Rail
Agency of SA envisages spending in the province during that period, as well as
the Durban-Pietermaritzburg express train being introduced this month.
The stress index, which measures negative aspects such as
unemployment, interest rates and indebtedness, is 2.9% down on the previous
year. Schüssler warned that economic stress will probably soon rise again as
consumers come under pressure.
"So far the consumer has been one of the major drivers
of the province's growth but, just as in the other provinces, the KwaZulu-Natal
trade index has also begun to fall – from 8.3% y/y in January to 7.1% in
February," said Schüssler.
The construction index (14.1% up on a year ago) is one of
the best performers in the local economy, especially thanks to good timber and
cement sales.
"Although the sector is not yet showing the highs of
2009, the index has begun to recover faster than expected since October last
year," said Schüssler.
While the financial, property and business services index in
all the other provinces was up on the previous year, in KwaZulu-Natal it
continued to fall, mainly owing to an 8.4% drop in advertising sales and a
45.6% fall in civil indebtedness cases. New home mortgages grew 0.2% y/y and
property transfers 7.1%.
- Sake24
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For more news on the Sake24/BoE Private Clients barometers,
go to www.fin24.com/barometer.