The South African economy recorded a modest 0.5% Gross Domestic Product (GDP) increase in the first quarter of 2026.
The data presented by statistician-general Risenga Maluleke revealed that the growth is higher than in the growth recorded in the final quarter of 2025.
The finance, real estate and business services sector was the main driver of growth, expanding by 0.9% and contributing 0.2 of a percentage point to overall GDP, supported by stronger activity in financial intermediation and related services.
Agriculture, forestry and fishing also performed well, growing by 3.9% and contributing 0.1 of a percentage point. The increase was largely due to improved output in field crops and horticulture.
The trade, catering and accommodation industry increased by 0.7%, with gains in wholesale and motor trade, as well as food, beverages and accommodation services. Similarly, the transport, storage and communication sector increased by 0.7%, supported by activity in land and air transport.
“The manufacturing industry decreased by 0,8%, contributing -0,1 of a percentage point. Five of the ten manufacturing divisions reported negative growth rates.
“The largest negative contributions were reported for the petroleum, chemical products, rubber and plastic products, basic iron and steel, non-ferrous metal products, metal products and machinery; and wood and wood products, paper, publishing and printing divisions,” said Maluleke.
On the expenditure side, real GDP also grew by 0.5%, following a 0.3% rise in the previous quarter. Household spending showed only slight growth of 0.1%, contributing 0.1 of a percentage point to GDP.
Consumers spent more on transport and housing-related costs such as electricity and water.
At the same time, spending declined in categories such as restaurants and hotels, food and non-alcoholic beverages, and alcoholic products.
Government spending increased by 0.6%, mainly driven by higher spending on goods, services and employee wages.
Investment was weakened as gross fixed capital formation dropped by 1.1%, cutting overall growth by 0.2%, the decline was driven by reduced spending on machinery, residential buildings and other assets.
“There was a R22.4-billion drawdown of inventories, seasonally adjusted and annualised value. Large decreases in two industries, namely manufacturing and trade, catering and accommodation, contributed to the inventory drawdown,” said Maluleke.
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