South Africa’s economy remains stuck in a recession, according to gross domestic product (GDP) data released by Statistics South Africa on Tuesday.
The economy contracted once again in the second quarter of the year, according to the Pretoria-based agency.
The seasonally adjusted real GDP at market prices for the second quarter of 2009 decreased by an annualised rate of 3% compared to the first quarter of 2009.
Economist Mike Schussler said: ”It is pretty much what the market expected. It shows that the slowdown has started to slow down at least. We are still in a recession, but the signs are there that we will see a turnaround before the end of the year.
”The third quarter might still be negative, but we could see things change by the end of the year.”
The main contributors to the decrease in economic activity for the second quarter of 2009 were the manufacturing industry (-1,6 percentage points); the wholesale and retail trade, hotel and restaurant industry (-0,6 of a percentage point); the finance, real estate and business services and the agriculture, forestry and fishing industries (each contributing 0,5 of a percentage point).
Positive contributions by other industries included the construction industry (0,5 of a percentage point); the general government services and the mining and quarrying industry (each contributing 0,3 of a percentage point) and personal services (0,1 of a percentage point).
Carmen Altenkirch, senior economist at Nedbank, said: ”Unsurprisingly, the worst-affected sectors included manufacturing, which continue to be adversely affected by both weak domestic and export demand, as well as retail and wholesale trade. Consumers remain reluctant to spend due to job losses and insecurity, still-high debt burdens and a general lack of confidence.
”Growth in government spending was supported by the government’s fiscal stimulus package. The construction sector also continued to benefit from the government’s infrastructure spending,” she said.
”We still expect to see a further contraction in the third quarter, albeit at a much more modest pace, growth should return in the fourth quarter.
”Since the peak of the cycle, GDP has fallen by roughly 3%.” — Sapa