{"id":826681,"date":"2025-06-03T13:02:41","date_gmt":"2025-06-03T11:02:41","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=826681"},"modified":"2025-06-03T13:02:47","modified_gmt":"2025-06-03T11:02:47","slug":"the-one-thing-keeping-south-africas-economy-from-tanking","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/826681\/the-one-thing-keeping-south-africas-economy-from-tanking\/","title":{"rendered":"The one thing keeping South Africa’s economy from tanking"},"content":{"rendered":"\n

South Africa’s economy has escaped a contraction at the start of 2025, with the economy boosted by the strong performance of the agriculture sector.<\/p>\n\n\n\n

Stats SA said the South African economy remained stable in Q1 2025, expanding by a marginal 0.1% compared with Q4 2024.<\/p>\n\n\n\n

Four of the ten industries on the production side of the economy recorded positive gains, with agriculture driving most of the upward momentum.<\/p>\n\n\n\n

Household spending, stronger exports and a drawdown in inventories also kept the economy’s expenditure side in positive territory.<\/p>\n\n\n\n

Agriculture production increased by 15.9%, adding 0.4 of a percentage point in the growth figure.<\/p>\n\n\n\n

“Good rains contributed to the industry\u2019s fortunes, with horticulture benefitting the most. Animal products also fared well,” said Stats SA.<\/p>\n\n\n\n

Without the increase from agriculture, GDP would have dropped by 0.3%.<\/strong><\/p>\n\n\n\n

Transport, storage & communication was the second-largest positive contributor, with gains seen in land transport, air transport and transport support services.<\/p>\n\n\n\n

Consumer activity was more substantial, as trade, catering, and accommodation expanded by 0.5%. Retail trade, motor trade, accommodation, and food and beverages were positive contributors.<\/p>\n\n\n\n

Mining and manufacturing were the largest drags in the first quarter, with both industries shaving off 0.4 of a percentage point off GDP growth.<\/p>\n\n\n\n

Mining weakened by 4.1%, with PGM metals the most significant negative contributor. Coal, chromium ore, gold, copper and nickel also declined.<\/p>\n\n\n\n

Manufacturing activity slowed due to weaker production levels for petroleum and chemicals, food and beverages, and motor vehicles and other transport equipment.<\/p>\n\n\n\n

Load shedding also reared its ugly head in Q1 2025 after a 310-day hiatus. This contributed to a 2.6% decline in electricity, gas & water, marking the most significant contraction since Q3 2022. <\/p>\n\n\n

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Spending also up <\/strong><\/h2>\n\n\n\n

The expenditure side of the economy was also marginally positive, growing by 0.1% in Q1 2025 from the previous quarter.<\/p>\n\n\n\n

A drawdown in inventories, exports and household consumption contributed positively, but imports, gross fixed capital formation and government consumption were negatives for growth.<\/p>\n\n\n\n

The R9.0 billion drawdown in inventories occurred in multiple industries, including transport, storage, and communication; trade, catering, and accommodation; manufacturing; finance, real estate, and business services; and personal services.<\/p>\n\n\n\n

This represents a fifth straight quarter of inventory drawdowns in the economy. Exports expanded for a second straight quarter, increasing by 1.0%.<\/p>\n\n\n\n

Vegetables, vehicles & transport equipment (excluding large aircraft) and mineral products underpinned the increase.<\/p>\n\n\n\n

Household consumption grew for the fourth straight quarter, buoyed by spending on transport, especially vehicles, food & non-alcoholic beverages, restaurants & hotels, miscellaneous goods & services, and health.<\/p>\n\n\n\n

That said, households cut back on recreation & culture and communication over the quarter.<\/p>\n\n\n\n

Gross fixed capital formation, which includes infrastructure development and investment in fixed assets, also dropped by 1.7%.<\/p>\n\n\n\n

There was also a slowdown in economic activity regarding residential buildings and construction works.<\/p>\n\n\n\n

Investments in machinery and other equipment and transport equipment were also far weaker over the quarter.<\/p>\n\n\n\n

Imports jumped by 2.0% in Q1 2025, negatively affecting economic growth. This rise was primarily driven by stronger demand for chemical products, mineral products, and machinery and electrical equipment.<\/p>\n\n\n

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\n","protected":false},"excerpt":{"rendered":"

South Africa’s economy grew in the first quarter of the year, primarily due to a boost from the agriculture sector. <\/p>\n","protected":false},"author":95,"featured_media":817998,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[1809],"class_list":["post-826681","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-stats-sa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/826681","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\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=826681"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/826681\/revisions"}],"predecessor-version":[{"id":826695,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/826681\/revisions\/826695"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/817998"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=826681"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=826681"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=826681"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}