Publications
Partners
Cape Town - Real gross domestic product (GDP) growth has been revised to 0.4% from 0.6% quarter-on-quarter for the 4th quarter of 2015, Statistics SA announced on Monday.
Growth in real GDP for 2015 as a whole, however, remained unchanged at 1.3%.
Stats SA will announce the GDP results for the first quarter of 2016 on June 8. The official GDP statistical release will, for the first time, include official GDP measured by production and expenditure on GDP. For the last 70 years the SA Bank has shouldered the responsibility for estimating expenditure on GDP. That task has now shifted to Stats SA.
Stats SA said on Monday it embarked on a process in 2012 that would enable it to improve its estimates of GDP estimates as measured from both the demand and supply sides of the economy.
Overall, nominal GDP growth in South Africa was slightly higher on average over the 5-year period from the first quarter of 2010 to the fourth quarter of 2015 - up by 0.1 percentage points to 8.2%.
Real GDP growth is now said to have been 0.1 percentage points higher over the same period, averaging 2.3%.
Production-side GDP reveals that the primary sector actually grew slightly stronger than previously thought over the five-year period, by an average 1.3% versus 0.9%, said Citi South Africa economist Gina Schoeman.
The secondary and tertiary sectors remained similar to their previous average five-year growth rates of 1.8% and 2.6% respectively.
"This does not mean, however, that the primary and secondary sectors escape the previously-seen fate of two technical recessions each since the start of 2014, something which we remain concerned is now plaguing the resilience of the tertiary sector via the services and nominal disposable income channel," said Schoeman.
An analysis by Citibank of the data released indicates that household consumption expenditure has been slightly weaker, growing 2.9% since 2010 versus 3.0% previously. The big differences are in the years 2013 and 20104 when household consumption actually grew 0.9 percentage points and 0.7 percentage points less than official data previous released.
Government consumption has been stronger by 0.3 percentage points, growing 2.5%; fixed investment has been stronger by 0.2 percentage points, growing 2.6% and overall domestic demand growth has been stronger by 0.5 percentage points, growing 3.0%.
Export growth has been weaker by 1.0 percentage points, growing 3.8% and import growth has been stronger by 0.4 percentage points, growing 6.2%.
"There are still some important findings below the surface. The most prominent in our view is that the revised nominal GDP figures reveal that the tax buoyancy rates for the financial years 2011/2012 to 2014/2015 are actually lower than Treasury previously calculated," said Schoeman.
"This suggests that the buoyancy rates projected in the February National Budget - which we had already pointed out as being overly optimistic at the time - could well be lowered at the October 2016 mini budget revision. This would place downward pressure on tax revenues, especially if GDP growth is confirmed as lower than National Treasury believe it to be in the February 2016 Budget."
A lower tax buoyancy assumption would in itself force the budget deficit projections wider, which means that Treasury either need to plug the gap through higher tax rates and/or further expenditure cuts, she cautioned.
