Third quarter GDP increases 66.1%

The South African financial system elevated by an annualised rate of 66.1% within the third quarter of 2020 as lockdown restrictions had been eased and extra financial exercise was permitted.

This is a pointy enhance from an annualised determine of 51% within the second quarter when the nation’s financial exercise was restricted because of the lockdown applied to curb the unfold of Covid-19.

Read: GDP collapses 51% within the second quarter

The quarter-on-quarter seasonally adjusted progress rate for the third quarter was 13.5%, down from 16.4% within the earlier quarter.

The enhance in GDP nevertheless didn’t translate to a lower in unemployment figures which confirmed a rise of seven.5 proportion factors to 30.,8% within the third quarter. In the second quarter, the unemployment rate decreased from 30.1% within the first quarter of 2020 to a document low of 23.3%.

This coincided with the exhausting lockdown when potential job seekers had been unable to search for work.

Read: Unemployment is worse than the official figures state

These “extremities” within the knowledge are anticipated as a result of the nation’s financial system has by no means skilled a shock such the pandemic, says Statistician-General, Risenga Malukele, including that the phenomena has been skilled the world over.

Deputy Director-General for  Economic Statistics, Joe de Beer additional defined throughout a presentation of the info on that in durations of maximum disruption comparable to Covid-19 or load shedding, the annualised determine for GDP could also be barely distorted. The annualised determine assumes that the exterior affect can be maintained for the complete calendar 12 months.

This was amplified this 12 months due to the pandemic as a result of the “behaviour of the financial system within the first and second quarter assumed that Covid-19 would proceed to [disrupt]…Similarly now the annualised determine assumes that the sharp recovery can be maintained for the complete calendar 12 months, “he mentioned.

De Beer, nevertheless, informed Moneyweb that the annualised determine stays helpful because it “still preserves the time series because otherwise, you will have a number that cannot be compared with anything else.”

“For comparability, you don’t want to change definitions because the environment changed. What you would rather do is to provide alternative measures,” he mentioned.

The unadjusted actual GDP at market costs for the primary 9 months of 2020 decreased by 7.9% in contrast with the primary 9 months of 2019. This is the typical variety of the previous three quarters. De Beer says this knowledge level can be helpful because it offers the general public a extra “secure “illustration of the financial system, in comparison with the figures proven in Q1 and Q2 of 2020.

In the presentation on Tuesday, Stats SA mentioned quarter-on-quarter progress rate additionally stays helpful. It could be annualised to indicate what the annual (i.e., year-on-year) rate could be if the quarter-on-quarter rate had been to happen 4 occasions in succession.

“The annualised rate provides a crude forecasting model that is useful in times of stable economic performance, but less so in a highly volatile environment.,” the report reads.

Nominal GDP was estimated at R1,27 trillion in Q3, up by R193 billion in Q2. Manufacturing was up by R44 billion to R156 billion, commerce was up by R40 billion to R167 billion and mining was R28 billion to R101 billion

All sectors of the financial system grew within the third quarter. The manufacturing business elevated at a rate of 210.2%, contributing 16.2% to the GDP progress.

The mining and quarry business elevated at a rate of 288.3% within the third quarter, contributing 11.8% to the GDP progress. This industries drastically benefited from the easing of restrictions domestically and internationally.

“Higher manufacturing was primarily because of elevated actions within the manufacturing of the platinum group metals (PGMs), iron ore, gold, manganese ore and diamonds, “Stats SA mentioned in an announcement on Wednesday.

The commerce, catering and lodging business elevated at a rate of 137%, whereas the transport, storage and communication business elevated at a rate of 79.3% due to increases in land transport, air transport, transport help companies and communication companies.

The development business elevated by 71.1% within the third quarter.


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