South Africa GDP Growth at 1-1/2-Year High in Q2


The South African economy advanced an annualized 3.3 percent on quarter in the three months to June of 2016, recovering from a 1.2 percent contraction in the previous period and beating market expectations of a 2.3 percent increase. It is the highest growth rate since the last three months of 2014, mainly boosted by manufacturing, mining and real estate activities.

The largest contributor to GDP growth was manufacturing, jumping 8.1 percent and contributing 1 percentage point. It is the highest growth rate in three years due to production of petroleum products, chemicals, rubber, motor vehicles, parts and accessories and other transport equipment. 

Mining and quarrying recovered in the second quarter, jumping 11.8 percent and contributing 0.8 of a percentage point. It follows an 18.1 percent contraction in the first quarter, mainly boosted by platinum output. 

Growth in finance, real estate and business services accelerated for the second straight period, reaching 2.9 percent, the highest in five quarters. Trade, catering and accommodation grew 1.4 percent (1.3 percent in Q1), mainly wholesale and motor trade. Transport, storage and communication increased by 2.9 percent (-2.7 percent), largely driven by activity in land freight transportation and communications.

In contrast, the agricultural sector shrank 0.8 percent, following a 6.5 percent decline in the previous period. It marks the sixth consecutive quarter of contraction due to severe droughts. Production declined mainly for field crops and horticulture products. In addition, the output for electricity, water and gas fell 1.8 percent, following a 2.8 percent slump in the previous quarter. 

Year-on-year, the economy expanded 0.6 percent, recovering from a 0.1 percent contraction in the first quarter. 

Statistics South Africa | Joana Taborda | joana.taborda@tradingeconomics.com
9/6/2016 11:20:28 AM