South Africa’s gross domestic product (GDP) dipped by 0.7% in the second quarter of 2022, Statistics SA (Stats SA) said on Tuesday, noting that the floods in KwaZulu-Natal and prolonged load-shedding contributed to the decline and weakened an already fragile economy.
“Manufacturing had the biggest drag on GDP due to flooding, which hurt several industries. Manufacturing is the largest industry in KwaZulu-Natal, according to 2019 data, accounting for a fifth of national manufacturing production,” said Stats SA.
It added that damage to factories and plants, industries, logistics and supply chains, pulled the national manufacturing output down by 5.9%, noting that trade, catering and accommodation were also negatively affected by the floods and power cuts.
“There was also a loss of trading hours due to load-shedding,” said Stats SA.
Activity in the electricity, gas and water supply industry was hampered mainly by load-shedding due to a lack of generation capacity while the floods and drought in the Eastern Cape resulted in the disruption of water supplies, said the agency.
According to Stats SA, the economy took almost two years to recover from the impact of Covid-19, with real GDP reaching pre-pandemic levels in the first quarter of 2022.
“The recovery was short-lived, with the 0.7% decline in the second quarter of 2022 dragging GDP back below the fourth quarter of 2019 pre-pandemic levels of R1 148-billion.”
Stats SA added that about six industries have not fully recovered, with construction currently in the worst shape. The construction industry is 24% smaller than it was before the pandemic.
Agriculture, forestry and fishing activities shrank by 7.7%, Stats SA said, dragged down by a decrease in the production of animal products. The spread of foot and mouth disease also contributed to the decline.
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