South Africa’s total manufacturing production soared by 5,4% in 2002, Statistics South Africa (Stats SA) reported on Tuesday.
This was the highest annual increase since 1995, when manufacturing production surged by 8,1% after six years of subdued growth.
Manufacturing growth in 2002 was prompted by the weak rand, which averaged R10,51 per US dollar in 2002 compared with 8,61 in 2001.
In 2001, manufacturing growth had been 2,8%, matching real gross domestic
product (GDP) growth of 2,8%. In 2000, manufacturing production rose by 3,7% in
a year when real GDP increased by 3,5%.
A strong rand in the final quarter of 2002, however, had a negative impact
on manufacturing production and the seasonally adjusted annualised change from
the third quarter 2002 was a decline of 3,7% and the increase on the fourth
quarter 2001 was only 3,0%.
Production in December fell by 1% m/m, the third consecutive monthly decline. The y/y increase was only 1,5%.
The fourth quarter decline has prompted calls by manufacturers for the
South African Reserve Bank (SARB) to cut interest rates after the rand gained
25% since the SARB last increased interest rates in September 2002, which was
the fourth increase in 2002.
In the third quarter 2002, manufacturing production soared by 8,4% y/y after rising by 8% y/y in the second quarter 2002.
The major contributor to the annual increase of 5,4% was the fabricated
metal products division (contributing +0,8 of percentage points to total
manufacturing production), followed by the machinery and equipment (+0,6 of a
percentage point), basic chemicals (+0,5 of a percentage point), basic iron and
steel products (+0,5 of a percentage point), other chemical products (+0,4 of a percentage point) and plastic products (+0,4 of a percentage point).
Higher production was reported by 23 of the 27 manufacturing divisions.
The total value of sales of manufactured products at current prices for the
year 2002 surged by 22,2% to R613,94-billion. Stats SA said that nominal GDP increased by only 11,4% y/y in the first three quarters of 2002.
This compared with a 12,1% increase in 2001, when nominal GDP expanded by
10,7%.
Increases in manufacturing sales were reported by all 27 manufacturing
divisions during 2002.
The largest increases were reported by the basic iron and steel products division (+36,5%), coke and refined petroleum products (+24,0%), basic chemicals (+24,0%), machinery and equipment (+23,9%), motor vehicles, trailers
and parts and accessories (+23,7%), fabricated metal products (+23,4%) and food
and food products (+22,5%) divisions.
The value of manufactured products rose by 13,6% y/y to R47,951-billion rand in December after increasing by 18,3% y/y in November to R58,5378-billion.
This compared with a 20,6% y/y rise in October to R58,632-billion and a
30,3% y/y increase in September to R55,09-billion. (8,48 rand–US $1) – I-Net-Bridge