Friday, June 14, 2019 / 05:00PM /
United Capital Research / Header Image Credit:SABC News
The Statistics South Africa (Stats SA) recently released South Africa’s GDP data for Q1-19. According to the report, momentum in Africa’s most advanced economy continues to falter amid myriads of economic and socio-political challenges.
GDP plunged -3.2% in Q1-19 following a +1.4% expansion in the preceding quarter (Q4-18), reaffirming the prevalence of challenges in the S/African economy. Key among the challenges bedeviling the economy includes; rising debt burden, wide income inequality, increasing level of unemployment, epileptic power supply, and sharp declining activities in the mining sector, to mention but a few.
A further search into the report showed that the country’s GDP was majorly dragged by weaker performance in the manufacturing, mining, and trade, catering & accommodation industries, all trending southwards by -8.8%, -10.8% and -3.6% respectively for the period under review.
We note that the negative start in the country’s GDP growth rate for the year mirrors the beginning of the prior year, 2018, when it recorded declines in GDP growth for the first two consecutive quarters of the year driving the economy back into a (technical) recession.
Though the swift cabinet reformation by the president Cyril Rhamaphosa, has been welcomed with much applaud, weobserve that the president most very quickly implement policy reforms to urgently address these challenges or risk the economy slidingback into another recession by Q2-19.
Top African Stories
• Kenya to raise capital gains tax to shore up revenues: Kenya will more than double its capital gains tax rate to 12.5% from 5% to bring it in line with international standards, Finance Minister Henry Rotich said in budget proposals to parliament on Thursday. Reuters
• Cocoa buyers agree to floor price proposed by Ghana, Ivory Coast: Buyers of Ghana and Ivory Coast cocoa agreed on Wednesday to a minimum price of $2,600 per tonne, as proposed by the two governments to address a perceived imbalance between farmers’ incomes and money made by big commodities traders. Reuters
• South Africa's Q2 business confidence is unchanged from Q1: South Africa’s business confidence in the second quarter remained unchanged from the previous quarter, a survey showed on Thursday, as the country struggles to boost growth. Reuters
• IMF approves disbursement of $248.15 mln under Angola's credit facility: The International Monetary Fund said its board had completed the first review under Angola’s extended arrangement and approved a disbursement of $248.15 million, taking the total of such payments to about $1.24 billion. Reuters
Apr-19 Trade Balance – June 18
Q1-19 GDP - June 27th
Q1-19 GDP - June 19th
PPI YOY– June 19th
May-19 (CPI) Inflation - June 29th
Policy Rate Decision –June 18th
May-19 (CPI) Inflation - June 17th
Q1-19 GDP - June 12th-22nd
Policy Rate Decision - June 11th-21st