South Africa’s gross domestic product (GDP) rose by 2% in the third quarter of 2017, following an increase of 2.8% in the second quarter, StatsSA said on Tuesday.
A Reuters poll expected third-quarter GDP growth to come in 1.5% quarter on quarter from 2.5% previously.
The rand was hardly moved following the release of the data, having firmed early on in the day, buoyed by the news that the race to succeed president Jacob Zuma as ANC leader looks tipped in current deputy president Cyril Ramaphosa’s favour, with voting data on Monday showing him ahead of main rival Nkosazana Dlamini-Zuma.
The local unit traded at R13.53 against the dollar.
The largest contributor to growth in GDP in the third quarter was the agriculture, forestry and fishing industry, which increased by 44.2% and contributed 0.9 of a percentage point to GDP growth, StatsSA said.
Mining and quarrying increased by 6.6% and contributed 0.5 of a percentage point to GDP growth. Manufacturing increased by 4.3%, which contributed a further 0.5 of a percentage point.
Three industries each contributed 0.1 of a percentage point to GDP growth, namely electricity, gas and water (-5.5% growth rate), trade (-0.4% growth rate) and general government (-0,7% growth rate), the stats body said.
Household final consumption expenditure increased by 2.6% in the third quarter of 2017, contributing 1.6 percentage points to total growth, while government final consumption expenditure decreased by 0.5%, contributing -0.1 of a percentage point.
Exports decreased by 10.3% and imports decreased by 13.7%. Net exports contributed 1.3 percentage points to total growth, StatsSA said.
At the end of last month, ratings agency S&P Global followed in the footsteps of Fitch in downgrading South Africa’s credit rating to full junk status – whereby both the country’s local and foreign currency debt is rated at sub-investment grade.
Fitch’s downgrade to full junk came earlier in the year, but a third ratings agency – Moody’s – decided to hold on its rating (which is currently one notch above junk) until after the 2018 budget speech under the guidance of new ANC leadership.