SA’s economy grows by 0.2% in 3rd quarter of 2016

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By – SAnews.gov.za

Cape Town – South Africa’s Gross Domestic Product (GDP) grew by 0.2% in the third quarter of 2016, Statistics South Africa’s Joe de Beer said on Tuesday.

The economy, however, grew by a rate of 3.5% in the second quarter. GDP had expanded by 0.3% in the third quarter of 2015.

“The main contributors to the GDP growth rate were the mining and quarrying industry, finance, real estate and business services, and general government services,” said De Beer, who is the Deputy Director-General of Economic Statistics.

Briefing journalists in Pretoria, De Beer said the mining and quarry sector increased by 5.1%, largely as a result of higher production in the mining of other metal ores, particularly iron ore.

The agriculture, forestry and fishing sector contracted by -0.3%, manufacturing by -3.2%, electricity, gas and water -2.9%, trade, catering and accommodation -2.1%.

“Drought is still the largest contributor to the decline in the agriculture sector but we are seeing that the 2016 drought is not as bad as it was in 2015,” he said.

De Beer said the agriculture, forestry and fishing industry has been in decline for seven consecutive quarters.

In monetary terms, De Beer said the nominal GDP was estimated at R1 087 billion for the 3rd quarter of 2016, which is R18 billion more than quarter two of 2016.

He said manufacturing expanded by R5 billion to R130 billion, while the transport and communication sector expanded by R5 billion to R99 billion.

Mining expanded by R3 billion to R79 billion.

Electricity decreased by R5 billion to R36 billion in the third quarter of 2016 while agriculture decreased by R11 billion to R24 billion.

Expenditure rises in the 3rd quarter

De Beer said expenditure on real domestic product grew by 0.5% in the third quarter.

He said the Household Final Consumption Expenditure increased by 2.6% quarter-on-quarter.

The increase was mainly as a result of expenditure on health services, which increased by 10% and contributed 0.7 of a percentage point.

He said government final consumption expenditure increased by 2.1%.

Net exports contributed negatively to total expenditure on GDP.

Exports decreased by 26.4%, mainly because of lower exports of precious metals and transport equipment.

Imports decreased by 4.9% and lower imports on machinery and electrical equipment contributed to this.