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Bloemfontein - This year South Africa’s economy is engaged
in an upward struggle to grow - but there’s no indication of a slipping back
into recession.
This is evident from the latest Sake24 provincial
barometers, which measure activity levels in five of the country’s provincial
economies each month.
In June all five of the provinces were down compared with
three months ago. The biggest sliders were the Eastern Cape ( 2.5%), followed
by the Western Cape ( 1%).
Matters however appear slightly better in KwaZulu-Natal and
the Free State (both 0.6% down), while Gauteng contracted 0.8%.
But there were sectors that did surprisingly well.
"I'm surprised at the manner in which construction in
various provinces rebounded, and communications are growing remarkably
countrywide," said Economists.co.za economist Mike Schüssler who compiles the
exclusive Sake24 provincial barometers.
The communication sub-index is compiled from the number of
cellphone and landline calls made across the entire country, as well as data
usage on the internet. In June the communications sub-index was 21% up,
reflecting both growing cellphone use and 58% growth in data usage.
Schüssler says telecommunications is the one sector on which
consumers are spending more.
But in other areas South African consumers would seem to be
less active than at the beginning of the year.
The provincial trade indices all
came back in the past three months and sales of durable goods like furniture
and electrical equipment were weaker.
Vehicle sales however remained in
positive territory countrywide, with the Western Cape (14.1% up on the year
before) doing best.
“Just keep in mind the role of purchases by vehicle-hire
companies and fleet owners.”
In June construction reflected revival in the Free State
(14.5% up year-on-year), Gauteng (12%) and the Eastern Cape (21.9%). These
provinces’ property sectors are evidently also doing better this year.
In June the country used considerably less electricity than
it did last year; declines were recorded in four of the provinces.
Schüssler
said although consumers are trying to save because of the high electricity
prices, it's the bulk consumers like factories and mines in particular that are
using less power.
“We are seeing the negative impact of the struggling global
economy on the production side of our
economy and exports are under pressure.”
Year-on-year, mining in Gauteng (9.1% down) and in the Free
State (7.7% down) is struggling, although on a quarterly basis Gauteng
recovered from a sharp first-quarter drop.
Stress factors in the economy probably play the major role
in the current downturn, said Schüssler.
The stress index, which reflects
interest rates, inflation, unemployment and summonses for debt, climbed in
three provinces. It's too soon to say whether the recent lowering of the prime
lending rate will help.
“We are moving forward, even if at a snail's pace, and at
this stage there is no talk of recession,” said Schüssler.
- Sake24
For more business news in Afrikaans, go to Sake24.com.
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