Published: Thu, September 06, 2018
Money | By Armando Alvarado

Africa's Second-Largest Economy South Africa Enters Recession

Africa's Second-Largest Economy South Africa Enters Recession

GDP in the second quarter contracted by 0.7 percent compared to the first three months of the current year.

Statistics South Africa said agricultural output fell 29.per cent in the second quarter, while the transport, communication and storage sector fell 4.9 per cent.

The trade industry experienced its second consecutive quarter of negative growth, falling by 1.9%, while government activity decreased by 0.5%, largely as a result of falling employment numbers in the civil service.

Africa's second largest economy has plunged into another "technical recession" after the country's GDP shrunk by 0.7 percent in the second quarter of the year.

It is a huge blow to President Ramaphosa's controversial reforms.

The president took over the ANC when the ruling party's support had slipped into a record low of 54.4% in the 2016 municipal elections which led to the ruling party losing control of Johannesburg to a coalition.

"The president is now in China, attending a summit".

New Yorker drops Steve Bannon from festival lineup after outcry
It's likely that Bannon will treat the New Yorker decision as a victory, said columnist Nesrine Malik of The Guardian . But this isn't James Baldwin vs William F Buckley.

The following are news items in South African major news outlets on Monday.

The GDP figures could also draw the attention of ratings agencies, who have South Africa's sovereign ratings near "junk" status.

The Head of Research at ETM Analytics, George Glynos, said the recession was a function of years of maladministration.

The fact that Ramaphosa is spending most of his time going around the world begging other countries to bailout our own state-owned entities, which he plans to privatize, is a clear indication of incoherence, confusion and lack of understanding of how to manage macroeconomic policy.

South Africa has the highest foreign-exchange turnover-to-GDP ratio among emerging markets, he said, helping explain why South Africa is often at the forefront of developing-world routs.

South African President Cyril Ramaphosa speaks during the during 2018 Beijing Summit Of The Forum On China-Africa Cooperation - Joint Press Conference at the Great Hall of the People at The Great Hall Of The People on September 4, 2018 in Beijing, China.

FNB economist Jason Muscat says there are "few shining lights" with broad weaknesses in the economy, and economic research consultancy company Capital Economics noted in a press statement that the economy should recover over the next year, but it believes that "a sharp rebound is unlikely".

Like this: