South Africa looks set to avoid a technical recession, with a possible upward “surprise” to full-year growth on the cards. <\/p>\n\n\n\n
Next Tuesday, 5 March, Stats SA will release the Q4 2023 GDP figures. <\/p>\n\n\n\n
Despite the fears at the start of 2023 that the nation would hit a recession, GDP grew by 0.4% and 0.6% in Q1 and Q2 2023, respectively. <\/p>\n\n\n\n
Although minimal, there was at least some growth, which was widely expected to be unattainable following the intense escalation of load shedding in the second half of 2022. <\/p>\n\n\n\n
However, in Q3 2023, GDP contracted by 0.2%, with the production side of the economy, especially agriculture, seeing weaker results.<\/p>\n\n\n\n
Two consecutive quarterly contractions would see South Africa enter a technical recession, hence the importance of the Q4 figure. <\/p>\n\n\n\n
The Bureau for Economic Research (BER) expects a slight quarterly expansion in Q4, meaning that the economy will avoid slipping into a technical recession. <\/strong><\/p>\n\n\n\n “Our full-year forecast is at 0.6% growth for 2023, but the available high-frequency data suggests that an upward surprise in Q4 and, by extension, the full-year growth figure is possible,” the BER said.<\/p>\n\n\n\n “From the expenditure side, the big uncertainty is around the impact of the intense harbour and rail disruption on net trade and inventories.”<\/p>\n\n\n\n “Looking at GDP from the production side, the big unknown is agriculture \u2013 which was a big drag on Q3 growth \u2013 and the \u2018invisible\u2019 tertiary sectors, where we do not have any high-frequency data.” <\/p>\n\n\n\n Year ahead<\/strong> <\/p>\n\n\n\n Domestic and international economists also expect South Africa’s GDP to grow further in 2024, even if it fails to keep up with population growth. <\/p>\n\n\n\n The Nedbank Group Economic Unit, International Monetary Fund and Deloitte all predict 1% growth in GDP in 2024. <\/p>\n\n\n\n Independent Economist Elize Kruger is slightly more optimistic, with GDP growth of 1.3% in 2024, which should boost the labour market in terms of wage settlements and job creation. <\/p>\n\n\n\n
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