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Cape Town – The Western Cape economy, unlike that of provinces that rely heavily on mining, did not receive a boost from this sector in July and reflected rather the general stagnation in the national economy, said Mike Schüssler, an economist at Economists.co.za.
The Sake24 Western Cape Barometer was only 0.3% up at 112.1 points in July, the stress index 3.3% up and the growth index 3.5% higher.
Schüssler said Western Cape tourism figures, which declined 0.5%, were down for the first time since November 2010.
The July the transport and communications index had the strongest growth of all the sub-indices in the barometer – 10.5% compared with the year before.
Communications activities make up 4.5% of the total barometer and grew 22.6%, indicating still-increasing cellphone and internet use.
The fact that tourism figures were down shows that spending on air travel, hotels and restaurants is one of the first things people cut down on when the economy starts to squeeze.
Video conferences are again being marketed strongly as a consequence of rising fuel costs which are reflected in more expensive airline tickets.
The financial, property and business services index rose 2.7%. Schüssler said house sales in the Western Cape had the strongest growth since February last year.
The barometer’s trade index is 6.1% up. Vehicle sales in the Western Cape are 19.1% up on a year ago, and Schüssler is still scratching his head as to how people in a struggling economy buy cars so easily.
He expects the manufacturing index, which grew 2.4% in July, to do even better in future.
That’s especially because the Western Cape manufacturing sector focuses on agriculture, food processing and timber products and not on the mining sector, which is expected again to experience a setback later.
The electricity index is 1.7% down, indicating that businesses and households are saving electricity as much as possible because of rising prices. The construction index is sharply down on a year ago, with a decline of 15.8%.
Although the agricultural index slipped 0.4%, wine production is 3.8% up. Meat production is only 1% down after having contracted by double-digit figures in previous months, and fishing rose 1.8%, its poorest showing for almost a year.
Wheat production declined 4.8% and fruit production was 1.2% down after having been generally 4% to 5% less over the past year than in the previous year.
The 3.3% rise of the stress index to 113.5 index points can be attributed to inflation at 4.8%, summonses for debt climbing by 7.6% and unemployment at 23.3% compared to the previous quarter’s 22.8%.
Schüssler believes the Western Cape economy’s figures will look relatively better in the third and fourth quarter as mining again retreats. The Western Cape still has a lower unemployment rate than other provinces.
- Sake24
The Sake24 Western Cape Barometer was only 0.3% up at 112.1 points in July, the stress index 3.3% up and the growth index 3.5% higher.
Schüssler said Western Cape tourism figures, which declined 0.5%, were down for the first time since November 2010.
The July the transport and communications index had the strongest growth of all the sub-indices in the barometer – 10.5% compared with the year before.
Communications activities make up 4.5% of the total barometer and grew 22.6%, indicating still-increasing cellphone and internet use.
The fact that tourism figures were down shows that spending on air travel, hotels and restaurants is one of the first things people cut down on when the economy starts to squeeze.
Video conferences are again being marketed strongly as a consequence of rising fuel costs which are reflected in more expensive airline tickets.
The financial, property and business services index rose 2.7%. Schüssler said house sales in the Western Cape had the strongest growth since February last year.
The barometer’s trade index is 6.1% up. Vehicle sales in the Western Cape are 19.1% up on a year ago, and Schüssler is still scratching his head as to how people in a struggling economy buy cars so easily.
He expects the manufacturing index, which grew 2.4% in July, to do even better in future.
That’s especially because the Western Cape manufacturing sector focuses on agriculture, food processing and timber products and not on the mining sector, which is expected again to experience a setback later.
The electricity index is 1.7% down, indicating that businesses and households are saving electricity as much as possible because of rising prices. The construction index is sharply down on a year ago, with a decline of 15.8%.
Although the agricultural index slipped 0.4%, wine production is 3.8% up. Meat production is only 1% down after having contracted by double-digit figures in previous months, and fishing rose 1.8%, its poorest showing for almost a year.
Wheat production declined 4.8% and fruit production was 1.2% down after having been generally 4% to 5% less over the past year than in the previous year.
The 3.3% rise of the stress index to 113.5 index points can be attributed to inflation at 4.8%, summonses for debt climbing by 7.6% and unemployment at 23.3% compared to the previous quarter’s 22.8%.
Schüssler believes the Western Cape economy’s figures will look relatively better in the third and fourth quarter as mining again retreats. The Western Cape still has a lower unemployment rate than other provinces.
- Sake24
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