The data means South Africa could be heading for recession and highlights the damage that the worst electricity outages on record are doing to Africa’s most industrialized economy.
South African President Cyril Ramaphosa on Monday appointed a new electricity minister as part of a cabinet reshuffle that he hopes will improve service delivery and shore up the governing party’s support ahead of a general election next year.
Analysts had predicted a 0.4% contraction in the October-December period.
Statistics South Africa revised third quarter growth to 1.8% quarter on quarter, from a previous estimate of 1.6%, but the country will tip into recession – defined as two consecutive quarters of falling GDP – if it contracts again in the current quarter.
Seven of the 10 industries tracked by Statistics South Africa shrank in October-December, with agricultural output falling 3.3% quarter on quarter, mining 3.2%, finance 2.3%, trade 2.1% and manufacturing 0.9%.
After 2.0% economic growth for 2022 as a whole, South Africa’s economy is now 0.3% bigger than it was in 2019 before the COVID-19 pandemic, Stats SA said, adding that the expansion was smaller than a 3.5% rise in the country’s population over the same period.
Gross domestic product grew 0.9% year on year in the fourth quarter, worse than forecasts for a 2.2% expansion. (Reporting by Bhargav Acharya Writing by Anait Miridzhanian Editing by Alexander Winning and Susan Fenton)
