South Africa avoided recession as its economy grew by 3.1% in Q2 2019 compared to the bleak first quarter of the year, Statistics SA announced on Tuesday.
It’s welcome news as it also means that South Africa has avoided yet another recession.
No ad to show here.
The quarterly growth also marks a 0.9% increase compared to Q2 2018, and a 0.4% increase compared to Q4 2018.
The growth was driven by a healthier mining industry, which grew 14.1% compared to last quarter. “Iron ore, manganese ore and coal were the main drivers” behind the increase, Stats SA added. This encouraged a primary sector growth of 9.7% overall.
The South African #economy grew by 3,1% in Q2:2019 mainly driving by the #mining industry that recorded its strongest growth since Q2:2016 #GDP Listen here for more: https://t.co/cIuR5xjuOf#StatsSA pic.twitter.com/EYm7R8O9A7
— Stats SA (@StatsSA) September 3, 2019
Agriculture, however, tainted an otherwise positive picture. It fell by 4.2% “on the back of lower production of field crops and horticultural products,” said Stats SA.
In the secondary sector, increases in manufacturing (2.1% growth) and electricity (3.2% growth) production boosted it by 1.5%. Construction, however, tanked 1.6% quarter-over-quarter. It’s the industry’s fourth consecutive negative quarter.
“Food and beverages, basic iron, steel and machinery, and motor vehicle parts” as well as “a rise in the volume of electricity distributed” were the primary drivers.
#Finance, real estate and business services – the largest industry in the South African #economy – grew by 4,1% driven by the banking & insurance sectors #GDP Listen here for more: https://t.co/cIuR5xjuOf#StatsSA pic.twitter.com/xxIWfCf0Tm
— Stats SA (@StatsSA) September 3, 2019
In the tertiary sector, the finance, real estate and business services industry grew 4.1%, the biggest gainer behind the mining industry. It was driven by “banking and insurance”.
Trade was up 3.9%, improved by “wholesale, retail, motor trade sales and accommodation services”, noted Stats SA.
“Household consumption expenditure increased by 2,8% in the second quarter, mainly driven by a rise in spending on food and non-alcoholic beverages, as well as recreation and culture. Households held back on eating out and accommodation, however. Spending on restaurants and hotels slipped by 3,8%,” it added in its longer report.
Peruse the full report by Stats SA here.
Feature image: Andy Walker/Memeburn
