Battered and beaten by load shedding, South Africa’s economy is still offering glimmers of hope.
Early economic data for January gives a glimmer of hope that South Africa may yet avoid a technical recession, say economists at the Bureau for Economic Research .
“While early days, this does firm up our view that the economy may avoid a technical recession following last quarter’s decline,” the BER said. This sounded the alarm for first quarter 2023 GDP forecasts, as the country has experienced load shedding every single day of the year so far – 76 days and counting – often at much higher stages than in Q4.
“We can now confirm that this translated to some actual production growth. Manufacturing production rose by 1.1% m-o-m, which exceeded expectations and followed a 0.5% increase in the previous month,” the BER said.sales at constant prices decreased by 3.6% y-o-y in January. This was the fourth consecutive annual decline.
The slight hope also does not discount the devastating impact of load shedding on the economy. That the country is seeing growth at all in the face of outages that see households and businesses thrust into the dark for up to 12 hours of a day is in itself a surprise.Every major bank and finance group that has published its results and forecasts for the year have noted the impact of load shedding on the economy, cutting growth projections severely for 2023.
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