{"id":196390,"date":"2017-09-04T12:42:05","date_gmt":"2017-09-04T10:42:05","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=196390"},"modified":"2017-09-04T12:42:05","modified_gmt":"2017-09-04T10:42:05","slug":"sa-economy-likely-out-of-recession","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/196390\/sa-economy-likely-out-of-recession\/","title":{"rendered":"SA economy likely out of recession"},"content":{"rendered":"

The worst may be over for Africa\u2019s two largest economies\u00a0as they likely emerged from a slump in the second quarter.<\/p>\n

Official data on Tuesday will probably show South Africa\u2019s economy\u00a0expanded in the three months through June, ending its second recession in less than a decade. Nigeria\u2019s gross domestic product probably grew from a year earlier, and came out of its worst slump in a quarter of a century.<\/p>\n

South Africa and Nigeria together account for almost half of sub-Saharan Africa\u2019s GDP and their recoveries may boost trade and production across the region.<\/p>\n

The reasons differ: while Nigeria, the continent\u2019s biggest oil producer, is benefiting from a rebound in crude output, stronger retail sales may help drive growth in South Africa.<\/p>\n

\u201cIn both cases a lot of the \u2018recovery\u2019 is due to things bouncing back from very poor performances in the reference quarter,\u201d John Ashbourne, an economist at London-based Capital Economics, said in an emailed response to questions.<\/p>\n

\u201cBut that\u2019s not all. In both cases, there is some real growth.\u201d<\/p>\n

South Africa\u2019s economy probably expanded an annualized 2.3% in the three months through June from the previous quarter, according to the median estimate of 20 economists in the survey. Nigerian GDP likely grew 1.3% from a year earlier after contracting for five straight quarters, a separate survey shows.<\/p>\n

More Dollars<\/strong><\/p>\n

A drop in the output and price of oil, Nigeria\u2019s largest export, and a lack of foreign currency weighed on West Africa\u2019s largest economy last year. The naira weakened after new rules allowing foreign-exchange dealers to quote naira levels used in actual trades came into place, and increased inflows alleviated some of the dollar shortages.<\/p>\n

Economic growth in Nigeria will \u201creturn to positive territory in the second quarter, on the back of a recovery in oil production, solid agriculture growth and an improvement in foreign-currency liquidity,\u201d\u00a0 Yvonne Mhango, an economist at Renaissance Capital, said in an emailed response to questions.<\/p>\n

\u201cWe expect the recovery and growth to be fragile.\u201d<\/p>\n

South Africa\u2019s economic woes were exacerbated by President Jacob Zuma\u2019s dismissal of Pravin Gordhan as finance minister, which led to Fitch Ratings Ltd. and S&P Global Ratings cutting the nation\u2019s foreign-currency debt to junk in April.<\/p>\n

The central bank halved its GDP growth forecast for the year to 0.5% in July.<\/p>\n

Agriculture and mining were the only two industries that expanded in the first quarter and both continued to perform well in the three months through June. Farming output was boosted by the end of the worst drought in more than a century and\u00a0 mining benefited from rising commodity prices.<\/p>\n

\u201cI don\u2019t think it\u2019s the start of a renewed growth cycle, but I think that the fear that we are heading for a deep recession has been abated,\u201d Kevin Lings, an economist at Stanlib Asset Management in Johannesburg, said by phone.<\/p>\n

\"\"<\/a><\/p>\n

\n

Read: South Africa after Zuma leaves office<\/a><\/strong><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

The worst may be over for Africa\u2019s two largest economies as they likely emerged from a slump in the second quarter.<\/p>\n","protected":false},"author":59,"featured_media":189283,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[],"class_list":["post-196390","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/196390","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=196390"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/196390\/revisions"}],"predecessor-version":[{"id":196400,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/196390\/revisions\/196400"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/189283"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=196390"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=196390"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=196390"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}