Gross domestic product up .9%

By  Amukelani Chauke

Pretoria – South Africa’s Gross Domestic Product (GDP) rose by 0.9% in the first quarter of 2013, Statistics SA said on Tuesday.

Briefing journalists in Sandton, Statistician-General Pali Lehohla said with the exception of the manufacturing industry – which reflected negative growth due to lower production of several products like petroleum – most sectors like mining, finance and government services all recorded positive growth.

“The seasonally adjusted real GDP at market prices for the first quarter of 2013 increased by an annualised rate of 0.9%, compared with an increase of 2.1% during the fourth quarter of 2012,” Lehlola said.

Prior to the release, several economists projected the growth to slow to less than 2% due to a strain brought about by slow growth in the manufacturing sector.

The main contributors to the positive growth were mining and quarrying industries, finance, real estate and business services, with each contributing 0.7 percentage points.

Despite illegal strikes in the mining industry that stretched to the last quarter of 2012, the sector showed growth due to a higher production of gold mining and other metal ores like platinum.

Government services contributed 0.3 percentage points, while the wholesale, retail, motor trade, catering, accommodation, transport, storage and communications industries each contributed 0.2 percentage points.

The manufacturing industry declined by 1.2 percentage points, while the agriculture, forestry and fishing, water, electricity and gas sectors showed a negative growth of 0.1 percentage points.

Lehohla said the GDP estimates were preliminary, and may be revised should additional evidence arise in the near future.

Impact on jobs

Government has previously said that a growth of at least 7% a year was needed in order to bring down the unemployment rate, which rose to 25.2% in the first quarter of 2013, from 24.9% in the fourth quarter of 2012.

Lehohla said on Tuesday: “The GDP, in the case of South Africa and in the case of many economies, is followed by growth in employment. And therefore, the decline in GDP will be followed by a decline in employment.

“We have seen employment gains over a period of time, from 2010 [during the aftermath of recession] up to now. But we see GDP actually slowing down. So if that holds, it may well be that jobs will follow [the slow growth]… so there might be a slow decline in jobs.”

He said while Stats SA never forecasts on growth figures, the GDP would need to record a positive growth for the fight against unemployment to be won. – SAnews.gov.za