South Africa’s economy contracts by 0,1% in first quarter of 2024.

By Lehlohonolo Lehana.

The Gross Domestic Product (GDP) decreased by 0.1% in the first quarter of 2024, according to the data released by Statistics SA on Tuesday.

This follows the 0.1% quarterly gain in the fourth quarter of 2023, which contributed to annual real GDP growth for the year of 0.6% compared with the increase of 1.9% in 2022.

The data shows that six out of 10 industries contracted during the first quarter of 2024. The biggest hit came from the manufacturing industry, which contracted by 1.4% after five of the 10 divisions reported negative growth rates. Manufacturing’s decline shaved 0.2 of a percentage point from South Africa’s GDP.

Other labour-intensive industries, including construction and mining and quarrying, also experienced contractions. South Africa’s largest industry, finance and business services, grew by a mere 0.1%.

A sluggish first-quarter performance was widely expected by economists, who cited continued power cuts as a contributing factor. The economy did not benefit from the over 60 days of suspended load-shedding since April. The country has since seen the longest break in load-shedding since February 2022.

Ahead of the GDP print’s release on Tuesday, Nedbank economists noted that first-quarter economic weakness was relatively widespread, hindered by load-shedding, low domestic demand, as well as sluggish growth in key trading partners, including Europe and China. According to the GDP data, exports decreased by 2.3% in the first quarter of the year. 

Nedbank forecast zero growth in the quarter.

First National Bank was slightly more optimistic, forecasting 0.1% quarterly growth. The bank did not count out a contraction, noting weakness in the goods-producing sectors, including freight transportation, during the quarter.

Scroll to Top