The country is struggling to right itself after waves of labour unrest this year hit corporate confidence, while rising food and fuel prices have squeezed consumers.
The economy grew 0.6% in the second quarter after contracting by the same amount in the first three months of this year, Statistics South Africa said on Tuesday. A Reuters poll of 26 analysts had forecast growth of 0.9%.
This was compared to a 0.6% drop in the real gross domestic product (GDP) in the first quarter of the year.
The GDP is the total value of goods and services produced in an economy in a certain time period.
Level of growth 'exceptionally low'
On an unadjusted year-on-year basis, the economy grew by 1% in the second quarter, compared with growth of 1.6% in the previous three months.
Analysts had expected year-on-year growth of 1.2%.
“We should remember the level of growth seen today is exceptionally low and totally insufficient to solve South Africa's deep developmental and jobs problems,” Peter Attard Montalto, an emerging markets analyst at Nomura International, said in a note to clients.
The main contributors to the increase in the second quarter of 2014 were general government services and the transport, storage, and communications industry, each contributing 0.4 of a percentage point, and finance, real estate and business services with 0.3 of a percentage point.
SA 2Q14 GDP bounced +0.6% (-0.6%). Growth yy eased to +1% (+1.6%). Averaging +1.3% in first half. Expect some revival in 3+4Q14...
— Cees Bruggemans (@ceesbruggemans) August 26, 2014
Mining drops output by 9.4%The mining and quarrying industry saw a 9.4% drop in quarter-on-quarter output, the data showed, after being hit by a five-month platinum strike this year.
Manufacturing, the economy's second-largest sector, fell by 2.1% from the previous three months, reflecting weak demand from struggling consumers.
Agriculture grew up nearly 5%, while finance and real estate expanded by 1.5%, the data showed.
Nominal GDP at market prices in the second quarter of 2014 was R891, R17bn more than the first quarter of 2014.
The unadjusted real GDP at market prices increased by 1% year-on-year, boosted by government services and transport, storage and communication.
The SA GDP trend since 2011 pic.twitter.com/7F4OVom7tS
— RegenesysInvestments (@RegenesysInvest) August 26, 2014
#SouthAfrica has avoided a technical recession with Q2 growth of 0.6%, but the y-on-y GDP trend is not reassuring pic.twitter.com/chfYBySl0Q
— Javier Blas (@JavierBlas2) August 26, 2014
Mining and manufacturing both posted negative growth rates (-9.4% and -2.1%), as expected. #SouthAfrica #GDP Q2
— Razia Khan (@raziakkhan) August 26, 2014
#SAGDP Growth Rate pic.twitter.com/rjxDK4RdNa
— Morne Dreyer (@DreyerMorne) August 22, 2014
On SA GDP growth we expected adjustment and underperformance. What's been delivered is partial adjustment and much deeper underperfomance.
— sizwe nxedlana (@sizwenxedlana) August 26, 2014