Further drop in GDP growth

Cape Town - South Africa’s gross domestic product grew at a meagre 0.2% in the third quarter of 2016, Statistics South Africa announced on Tuesday.

The growth recorded was significantly lower than the previous quarter’s 3.3% and 0.1 percentage point lower than the 0.3% recorded in the third quarter of 2015.

“The main contributors to growth were the mining and quarrying sector, finance, real estate and business services and general government services,” Statistics SA deputy director general Joe de Beer said at a media briefing at Parliament.

The growth in the mining and quarrying sector, which expanded by 5.1%, was attributed to higher production in the mining of particularly iron ore.

Four industries – agriculture, forestry and fishing; manufacturing; electricity, gas and water; and trade, catering and accommodation - contracted. The agricultural, forestry and fisheries sector has been in decline for seven consecutive quarters.

“The contraction in the agricultural sector specifically could be attributed to the drought,” De Beer said, “but indications are that the drought experienced in 2016 is less severe than in 2015.”

Expenditure on GDP grew by 0.5%. The increase was by and large as a result of expenditure in health services, which increased by 10%.

Government final consumption expenditure increased by 2.1%, with household consumption expanding by 2.6%.

Net exports in the third quarter contributed negatively to total expenditure on GDP, falling by 26.4%, mainly because of lower exports of precious metals and transport equipment.

Imports also decreased by 4.9%, mainly because of subdued imports of machinery and electrical equipment.

The revised GDP growth figure Statistics SA recorded year-on-year for the third quarter was 0.7%.