This puts South Africa on track to post GDP growth of 1% in 2024\u2014in line with wider predictions\u2014and 1.7% in 2025.<\/p>\n\n\n\n
However, challenges and risks remain<\/p>\n\n\n\n
Improved operating conditions<\/strong><\/p>\n\n\n\n A key factor in the third quarter’s positive performance was the consistent availability of electricity. <\/p>\n\n\n\n For over eight months, Eskom, the national power utility, has managed to avoid implementing load-shedding, a rolling blackout system that has crippled the economy in recent years. <\/p>\n\n\n\n This improved energy situation can be attributed to a combination of weaker demand due to subdued economic activity, increased electricity supply, and a growing shift to renewable energy sources.<\/p>\n\n\n Logistics show modest gains<\/strong><\/p>\n\n\n\n Alongside the energy sector, Huntley and Weimar note that there have been marginal improvements in the country’s logistical networks.<\/p>\n\n\n\n For the year to date, 121 million tonnes have been moved via rail, up by a slight 0.4% from the same period last year.<\/p>\n\n\n\n According to the latest National Logistics Crisis Committee (NLCC) Pulse Report, the average time spent moving freight by road has fallen across seven of the eight major transport corridors.<\/p>\n\n\n\n Transit times for road freight have decreased across seven of the eight major transport corridors. The report highlights the N1 Cape Town corridor, which experienced a significant reduction in transit times of 26 hours. <\/p>\n\n\n\n Port call durations at Cape Town and Richards Bay also declined noticeably.<\/p>\n\n\n\n Mixed sector performance<\/strong><\/p>\n\n\n\n While the overall economic picture showed signs of improvement, performance across different sectors was mixed. <\/p>\n\n\n\n Domestic trade likely contracted in Q3 due to sharp declines in wholesale sales, continued weakness in the motor trade, and reduced spending on food and beverage services. <\/p>\n\n\n\n The mining, manufacturing, and construction sectors managed to increase output modestly, benefiting from the improved operating environment. <\/p>\n\n\n\n The finance, real estate, and business services sector is anticipated to have experienced steady growth, supported by moderate growth in credit demand and a slow recovery in commercial property.<\/p>\n\n\n\n Q3 unemployment drop<\/strong>, but figures remain high<\/strong><\/p>\n\n\n\n South Africa\u2019s official unemployment rate has reached 32.1% for the third quarter of 2024\u2014improving by 1.4 percentage points over the previous quarter.<\/p>\n\n\n\n According to Stats SA Quarterly Labour Force Survey, the number of employed persons increased by 294,000 to 16.9 million in Q3 2024.<\/p>\n\n\n\n There was also a decrease of 373,000 in the number of unemployed persons to 8.0 million.<\/p>\n\n\n\n With that said, South Africa’s unemployment figures remain alarmingly and unsustainably high, with the expanded unemployment rate at\u00a041.9%<\/strong>.<\/p>\n\n\n\n Positive outlook for Q4 2024 and 2025<\/strong><\/p>\n\n\n\n Nedbank’s economic unit expects the recovery to gain further momentum in the final quarter of 2024 and into 2025. <\/p>\n\n\n\n Factors contributing to this positive outlook include:<\/p>\n\n\n\n Not all smooth sailing \u2013 structural issues remain<\/strong><\/p>\n\n\n\n Despite the positive signs, the report acknowledges the persistence of deep-seated structural challenges in the energy and logistics sectors. <\/p>\n\n\n\n These issues continue to limit South Africa’s international competitiveness and constrain the economy’s ability to fully capitalise on global economic upswings.<\/p>\n\n\n\n Medium-term outlook<\/strong><\/p>\n\n\n\n The report notes that the South African economy is expected to experience a moderate recovery over the medium term, with GDP growth of 1% in 2024 and 1.7% in 2025.<\/strong><\/p>\n\n\n\n Several factors contribute to the positive outlook:<\/p>\n\n\n\n Challenges and risks<\/strong><\/p>\n\n\n\n Despite the positive outlook, several challenges could hinder recovery:<\/p>\n\n\n\n Going forward<\/strong><\/p>\n\n\n\n While challenges and risks remain, the report notes that the South African economy appears to be turning a corner.<\/p>\n\n\n\n The absence of load-shedding, coupled with marginal improvements in logistics and falling inflation, has created a more favourable environment for businesses.<\/p>\n\n\n\n The recovery is expected to gain further traction in the coming quarters, driven by both cyclical and structural factors. <\/p>\n\n\n\n However, it notes that addressing the long-standing issues in the energy and logistics sectors remains crucial for unlocking the country’s full economic potential.<\/p>\n\n\n\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2024\/11\/image-102.png\")
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