Johannesburg - Expansion in the private sector slowed to a crawl in May as power supply shortages and weak export demand weighed on output, a survey showed on Wednesday.
The HSBC Purchasing Managers' Index (PMI) edged down to 50.1 in May from 51.5 in April, its lowest reading since February, although it held just above the 50 mark denoting growth in activity.
Companies surveyed reported a decline in output for the first time this year, HSBC said.
"May’s survey results paint a worrying picture of the health of the private sector economy. Survey respondents partly blamed ongoing power outages for the drop in activity," said Oliver Kolodseike, an economist at financial information services firm Markit, which helped compile the survey.
South Africa is battling its most serious power supply shortages since 2008 and state-owned power utility Eskom implements frequent rolling power cuts to avoid overwhelming the grid.
The survey also showed that while strong domestic demand lifted new orders, export demand declined at its fastest rate in 10 months despite a relatively weaker rand.
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