{"id":285272,"date":"2018-11-19T15:37:42","date_gmt":"2018-11-19T13:37:42","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=285272"},"modified":"2018-11-19T15:37:42","modified_gmt":"2018-11-19T13:37:42","slug":"gauteng-is-africas-7th-biggest-economy","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business\/285272\/gauteng-is-africas-7th-biggest-economy\/","title":{"rendered":"Gauteng is Africa\u2019s 7th biggest economy"},"content":{"rendered":"<p>South Africa\u2019s Gauteng province beat several other African locations to host the<a href=\"https:\/\/africainvestmentforum.com\/\">\u00a0Africa Investment Forum<\/a>, premier David Makhura said in early November.<\/p>\n<p>Makhura was speaking at the opening of the regional meeting in Johannesburg, which\u00a0<a href=\"https:\/\/africainvestmentforum.com\/about-us\/\">sought to<\/a> seal billions in investment deals.<\/p>\n<p>To highlight Gauteng\u2019s attractiveness to African finance and industry, Makhura made two claims about the size of the province\u2019s economy. We tested them against the best available evidence.<\/p>\n<div class=\"inline-rating correct\">\n<div class=\"the-claim\">\n<ul>\n<li class=\"claim-content\"><strong>Claim:<\/strong> \u201cGauteng contributes 35% to South Africa\u2019s GDP.\u201d<\/li>\n<li><strong>Verdict: <span style=\"color: #008000;\">Correct<\/span><\/strong><\/li>\n<\/ul>\n<\/div>\n<\/div>\n<p>Gauteng was the \u201cleading financial nerve centre and manufacturing hub of sub-Saharan Africa\u201d,\u00a0<a href=\"https:\/\/www.youtube.com\/watch?v=1yMf7XWPHF4&amp;feature=youtu.be&amp;t=1808\">Makhura said<\/a>.\u00a0\u201cWe contribute 35% to our country\u2019s GDP.\u201d<\/p>\n<p>A country\u2019s\u00a0<a href=\"https:\/\/www.imf.org\/external\/pubs\/ft\/fandd\/basics\/gdp.htm\">gross domestic product<\/a>\u00a0is the measure of the size of its economy. It is the market value of all goods and services produced in a country in a given period, usually a year. Any economic activity will increase GDP \u2013 as long as the activity is recorded.<\/p>\n<p><a href=\"http:\/\/www.statssa.gov.za\/\">Statistics South Africa<\/a>, the national data agency, records the nine provinces\u2019 contribution to the country\u2019s economy. Its\u00a0<a href=\"http:\/\/www.statssa.gov.za\/publications\/P0441\/GDP_Q4_2017_Media_presentation.pdf#page=48\">most recent data<\/a>\u00a0puts South Africa\u2019s total GDP at R4.35 trillion in 2016. Gauteng\u2019s contribution was R1.5 trillion, or 34.64%.<\/p>\n<p><strong>How is GDP calculated?<\/strong><\/p>\n<p>When compiling the data, the agency used a \u201cbottom-up approach\u201d, Stats SA chief economist Bontlenyana Makhoba told Africa Check.<\/p>\n<p>\u201cAll the industries that we look at will have different data sources. So if, for example, we are looking at agriculture, we will work with the department of agriculture. If it\u2019s mining, we will work with the department of mineral resources\u2026 so it depends on what you are looking at.\u201d<\/p>\n<p>Provincial contributions were calculated at current rates, which meant they \u201cinclude all changes in market prices that have occurred during the year due to inflation\u201d, Makhoba added.<\/p>\n<p>Stats SA\u2019s Gauteng GDP estimate sounded \u201cabout right\u201d,\u00a0<a href=\"https:\/\/www.wits.ac.za\/staff\/academic-a-z-listing\/r\/jannierossouwwitsacza\/\">Prof Jannie Roussouw<\/a>, the head of the\u00a0<a href=\"https:\/\/www.wits.ac.za\/sebs\/\">school of economic and business sciences<\/a>\u00a0at the\u00a0<a href=\"https:\/\/www.wits.ac.za\/\">University of Witwatersrand<\/a>, told Africa Check.<\/p>\n<p>\u201cIt might be slightly skewed because many head offices are registered here in Gauteng but they have activities in other provinces.\u201d He said the province had been South Africa\u2019s economic heartland for years.<\/p>\n<div class=\"inline-rating correct\">\n<div class=\"the-claim\">\n<ul>\n<li><strong>Claim:<\/strong>\u00a0\u201cGauteng is the seventh largest economy in Africa.\u201d<\/li>\n<li><strong>Verdict: <span style=\"color: #008000;\">Correct<\/span><\/strong><\/li>\n<\/ul>\n<\/div>\n<\/div>\n<p>Gauteng was key to trade and other connections between the continent\u2019s economies, Makhura said, and was \u201c<a href=\"https:\/\/youtu.be\/1yMf7XWPHF4?t=1836\">the seventh largest economy in Africa<\/a>\u201d.<\/p>\n<p>Comparing the GDP of different geographical regions was accepted practice, said Grieve Chelwa, who lectures economics at the\u00a0<a href=\"http:\/\/www.uct.ac.za\/\">University of Cape Town<\/a>\u2019s\u00a0<a href=\"https:\/\/www.gsb.uct.ac.za\/\">Graduate School of Business<\/a>. It\u2019s a useful way to better understand the size of an economy.<\/p>\n<p>\u201cFor example, it\u2019s far easier if I say \u2018if California were a country it would be the\u00a0<i>x<\/i>th largest country by economy\u2019 than if I gave you some absolute statement about the actual size of California\u2019s GDP,\u201d\u00a0Chelwa told Africa Check.<\/p>\n<p>\u201cSo the premier is perfectly correct to make that statement.\u201d The expectation was that Gauteng\u2019s GDP had been calculated correctly, he said, without produce from other provinces being added.\u00a0\u201cThis is much harder to do in practice.\u201d<\/p>\n<p>The\u00a0<a href=\"https:\/\/www.afdb.org\/en\/\">African Development Bank<\/a>\u00a0has\u00a0<a href=\"https:\/\/www.afdb.org\/fileadmin\/uploads\/afdb\/Documents\/Publications\/African_Statistical_Yearbook_2017.pdf#page=50\">data<\/a>\u00a0on the GDP of 54 African countries in 2016. Africa\u2019s total economic output was measured at US$2.259 trillion.<\/p>\n<p>Gauteng\u2019s<a href=\"http:\/\/www.statssa.gov.za\/publications\/P0441\/GDP_Q4_2017_Media_presentation.pdf#page=48\">\u00a035% share<\/a>\u00a0of South Africa\u2019s estimated GDP of $285.8 billion would be $100 billion, placing it seventh \u2013 ahead of Kenya, Ethiopia and Tanzania.<\/p>\n<div class=\"bt_table\">\n<div class=\"table-responsive\"><table class=\"table\" width=\"100%\" cellspacing=\"0\" cellpadding=\"6\">\n<tbody>\n<tr>\n<th bgcolor=\"#CCCCCC\" width=\"50%\">Country<\/th>\n<th style=\"text-align: center;\" bgcolor=\"#CCCCCC\" width=\"50%\">2016 GDP (US$)<\/th>\n<\/tr>\n<tr>\n<td>Nigeria<\/td>\n<td style=\"text-align: center;\">$433.8 billion<\/td>\n<\/tr>\n<tr>\n<td>Egypt<\/td>\n<td style=\"text-align: center;\">$320.9 billion<\/td>\n<\/tr>\n<tr>\n<td>South Africa<\/td>\n<td style=\"text-align: center;\">$285.8 billion<\/td>\n<\/tr>\n<tr>\n<td>Algeria<\/td>\n<td style=\"text-align: center;\">$165.9 billion<\/td>\n<\/tr>\n<tr>\n<td>Morocco<\/td>\n<td style=\"text-align: center;\">$115.9 billion<\/td>\n<\/tr>\n<tr>\n<td>Sudan<\/td>\n<td style=\"text-align: center;\">$110.4 billion<\/td>\n<\/tr>\n<tr>\n<td><em>Gauteng<\/em><\/td>\n<td style=\"text-align: center;\"><em>$100.0 billion<\/em><\/td>\n<\/tr>\n<tr>\n<td>Angola<\/td>\n<td style=\"text-align: center;\">$96.9 billion<\/td>\n<\/tr>\n<tr>\n<td>Kenya<\/td>\n<td style=\"text-align: center;\">$73.3 billion<\/td>\n<\/tr>\n<tr>\n<td>Ethiopia<\/td>\n<td style=\"text-align: center;\">$70.2 billion<\/td>\n<\/tr>\n<tr>\n<td>Tanzania<\/td>\n<td style=\"text-align: center;\">$50.2 billion<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n<\/div>\n<p>This article was first published by Africa Check. <strong><a href=\"https:\/\/africacheck.org\/reports\/does-gauteng-make-up-a-third-of-south-africas-gdp-and-is-it-africas-seventh-biggest-economy\/\">You can read the original and follow any updates here.<\/a><\/strong><\/p>\n<hr \/>\n<p><strong>Read:\u00a0<a href=\"https:\/\/businesstech.co.za\/news\/motoring\/284360\/joburgs-traffic-wardens-have-been-given-extra-powers-heres-what-they-can-do-now\/\" rel=\"bookmark\">Joburg\u2019s traffic wardens have been given extra powers \u2013 here\u2019s what they can do now<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Gauteng Premier David Makhura recently claimed that the province contributes more than a third of South Africa&#8217;s GDP and if it were a country, it would be the 7th largest by GDP in Africa &#8211; here are the facts.<\/p>\n","protected":false},"author":40,"featured_media":273077,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[26],"class_list":["post-285272","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/285272","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\/40"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=285272"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/285272\/revisions"}],"predecessor-version":[{"id":285280,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/285272\/revisions\/285280"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/273077"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=285272"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=285272"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=285272"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}