The South African economy has displayed unconvincing growth in the second quarter of 2024. The 0.4% growth followed a stagnant performance in the first quarter.
Significant advancements in the finance, real estate, and business services sector, which saw a 1.3% increase and contributed 0.3% to the overall gross domestic product (GDP), were primarily responsible for this growth.
In addition, the electricity, gas, and water sector experienced a notable 3.1% growth due to a substantial rise in electricity and water production and consumption.
This sector’s expansion contributed 0.1 percentage point to the GDP.
The trade, catering, and accommodation sector also saw an increase of 1.2%, with wholesale trade, retail trade, and accommodation contributing an additional 0.1% to the GDP.
However, the transport, storage, and communication industry faced a decline of 2.2% due to reduced economic activity in land transport and transport services, resulting in a negative contribution of -0.2 percentage points.
Mining and quarrying had a 0.0% contribution as it remains in a -0.8% decline. However, this is an improvement from the first quarter’s -1.7%.
Record quarterly high
According to Statistics South Africa (Stats SA), net exports had a detrimental effect on GDP, with a 0.4% decrease attributed to a decline in trade of vegetable products, mineral products, vehicles, and transport equipment (excluding large aircraft).
Stats SA further reported that expenditure on real GDP hit a record quarterly high of R1.1-billion in the second quarter of 2024, marking a 0.5% increase from the first quarter and recovering from a previous 0.1% decrease.
Household final consumption expenditure (HFCE) rose by 1.4%, contributing 0.9 percentage points to the total growth.
Within the HFCE, the “other” category emerged as the major contributor with a 4.5% increase, adding 0.6 percentage points.
Clothing and footwear saw a 3.2% increase, contributing 0.2 percentage points.
This is a recovery from the 7% decrease from the first quarter, which had contributed -0.4%.
The food and beverages contributed 0.2 percentage points, with a 1.2% increase.
