Friday, 9 December, 2022

SA GDP shrinks, hit by floods, energy crisis

JOHANNESBURG: South Africa's economy shrank in the second quarter, as floods and an energy crisis put a halt to months of growth, official data showed Tuesday.

The dip in output after two consecutive quarters of modest growth dragged Africa's most industrialised economy back below pre-coronavirus pandemic levels, reports AFP.

The official statistics agency StatsSA said gross domestic product retreated by 0.7 percent in the second quarter.

"The economy took almost two years to recover from the impact of COVID-19," the agency said in a statement. "The recovery was short lived".

Devastating floods that killed more than 450 people in the southeastern KwaZulu-Natal province and power cuts caused by a prolonged energy crisis contributed to the decline, "weakening an already fragile national economy", the agency said.

"The flooding had a negative impact on a number of industries, most notably manufacturing," StatsSA said.

Damages to factories and plants, and disruptions to logistics and supply chains caused by the torrential rains, pulled national manufacturing output down by 5.9 percent, it said.

Mining and the electricity, gas and water supply industry were hampered by weeks of severe rolling blackouts, known locally as load shedding, it said.