South Africa’s gross domestic product (GDP) has suffered its biggest drop in 10 years, according to Statistics South Africa (Stats SA) here on Tuesday.
Due to this development, the country’s economy shrank by 3.2% in the first three months of the year, Stats SA said.
The agency said a decrease had been predicted by analysts and the South African Reserve Bank, which earlier flagged depressed expenditure and investment in the economy, weak consumer demand, negative impact of load-shedding and recurring falls in mining production as pull factors.
But the size of the contraction came as a surprise, according to the analysts, adding that if the local economy contracts again in the next quarter of 2019, the country would enter a recession.
South Africa’s economy slid into recession in the first half of 2018 after experiencing two successive quarters of negative economic growth, the analysts noted.
Growth gained pace in the third quarter of that year, they said.
NM/jn/APA