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April wholesale trade sales jump 5.7% y/y

Cape Town – Wholesale trade sales increased by 5.7% in April 2016 compared with April 2015, Statistics SA announced on Wednesday.

Seasonally adjusted wholesale trade sales decreased by 1.9% in April compared with March. This followed month-on-month changes of 0.8% in March and 2.9% in February, Stats SA explained.

In the three months ended April 2016, seasonally adjusted wholesale trade sales increased by 2% compared with the previous three months.

Measured in nominal or current prices, wholesale trade sales increased by 12.8% in April 2016 compared with April 2015.

The main contributors to this increase were dealers in agricultural raw materials and livestock, which contributed 4.9 percentage points to the increase.

Precious stones, jewellery and silverware contributed 2.3 percentage points, while machinery, equipment and supplies contributed 2.6% percentage points.

The latest stats come as South Africa’s economy skates on the edge of a recession, with the gross domestic product (GDP) contracting 1.2% in the first quarter of 2016.

South Africa's annual consumer price inflation slowed to 6.2% in April 2016, according to Stats SA.

Although a technical recession is described as two successive quarters of economic decline, economist Dawie Roodt told Fin24 last week that in his view South Africa is already in a recession.

"As far as I am concerned we have been in a recession for the past year. The reason is our economy has been growing below the growth levels of our population."

However, Statistician general Pali Lehohla said last week that “we can’t say we’re heading for a recession. That we don’t know.”     

On the production side of GDP, mining and quarrying fell to -18.1%, by and large due to lower production of platinum and iron ore.

Exports and imports both shrunk by 7.1% in the first quarter of 2016, the GDP figures revealed.

The prolonging drought had a significant negative impact on production side of GDP and the decline of 6.5% in the first quarter of 2016 was by and large the result of a lower production of field crops and horticultural products.

Roodt said South Africa is battling with soaring unemployment and low skills.

"We need to grow the economy's primary sectors such as mining and agriculture in order for unskilled people to work, but both these sectors are in recession," he cautioned.

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