Economic Growth in South Africa
South Africa's GDP growth from 2013 to 2022 was constrained by structural issues, including high unemployment, violent crime, corruption and electricity supply crises. The COVID-19 pandemic caused a significant contraction in 2020. By 2022, the economy showed signs of recovery, but growth remained tepid by Sub-Saharan African standards
South Africa recorded an average real GDP growth rate of 1.0% in the decade to 2022, below the 3.0% average for Sub-Saharan Africa. In 2022, real GDP growth was 1.9%. For more GDP information, visit our dedicated page.
South Africa GDP Chart
South Africa GDP Data
2018 | 2019 | 2020 | 2021 | 2022 | |
---|---|---|---|---|---|
Economic Growth (GDP, ann. var. %) | 1.6 | 0.3 | -6.0 | 4.7 | 1.9 |
GDP (USD bn) | 405 | 389 | 338 | 420 | 405 |
GDP (ZAR bn) | 5,363 | 5,625 | 5,568 | 6,209 | 6,629 |
Economic Growth (Nominal GDP, ann. var. %) | 5.6 | 4.9 | -1.0 | 11.5 | 6.8 |
GDP declines at steeper-than-expected rate in Q3
GDP contracted 0.2% on a seasonally adjusted quarter-on-quarter basis in the third quarter, below the 0.5% expansion tallied in the second quarter. Q3's reading marked the worst since Q4 2022.
Domestically, household spending contracted 0.3% in Q3 (Q2: -0.2% s.a. qoq), marking the steepest decline in two years. Additionally, fixed investment contracted 3.4% in Q3 (Q2: +3.8% s.a. qoq), marking the worst reading since Q2 2020. Meanwhile, government consumption growth was the slowest since Q2 2020, expanding 0.3% (Q2: +1.8% s.a. qoq). On the external front, exports of goods and services increased 0.6% on a seasonally adjusted quarterly basis in the third quarter, which matched the second quarter's reading. Conversely, imports of goods and services deteriorated, contracting 8.6% in Q3 (Q2: +3.2% s.a. qoq), marking the worst reading since Q2 2020. As such, the external sector contributed 2.9 percentage points to the overall reading, preventing a steeper decline. The quarterly GDP decline surprised markets on the downside. The infrastructure—port and rail—crisis added insult to injury for the power supply, with blackouts lasting for as long as 10 hours a day, hitting activity in turn. More positively, the unemployment rate decreased in Q3—although it remained one of the highest in the world—and inflation averaged below Q2 in the quarter. On an annual basis, GDP contracted 0.7% in Q3, contrasting the previous period's 1.5% increase. Q3's reading marked the sharpest downturn since Q1 2021.
The economy is expected to return to growth in Q4 2023, largely due to a favorable base of comparison. However, in 2024, sequential growth should gain steam.
Analysts at the EIU commented on upside risks to GDP growth in 2024: “A key boost to growth in 2024 will be a gradual decline in crippling electricity shortages as new private-sector renewable energy generation comes on stream, leading to fewer instances of major power cuts and less disruption to business operations. A concurrent easing in transport bottlenecks will reinforce the positive trend, although there is little prospect of logistics and power-supply constraints being eliminated in 2024.”
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects South African GDP projections for the next ten years from a panel of 29 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable GDP forecast available for South African GDP.
Download one of our sample reports to visualize what a Consensus Forecast is and see our South African GDP projections.
Want to get access to the full dataset of South African GDP forecasts? Send an email to info@focus-economics.com.
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