When President Cyril Ramaphosa goes to Parliament to defend his administration’s record of leading the country in economic recovery, reconstruction and social transformation, he will be speaking with increased confidence because the numbers tell a positive story: for the first time since the COVID pandemic hit, South Africa’s GDP is seeing some improvement. Newly released data by Statistics SA shows that the economy improved in the first quarter of 2022. In the first three months, the GDP increased by 1.9% in quarter-on-quarter seasonal adjusted terms and 3% in year-on-year unadjusted terms. Similarly, the official unemployment rate fell by 0.8 percentage points from 35.3% in the first quarter of 2021 to 34.5% in the same period of 2022, leading the enlarged definition of unemployment to witness a 0.7% drop. Business Edge for Thursday examines the latest data from South Africa and how both the GDP and employment have improved. Professor Jannie Rossouw, Visiting Professor at Wits Business School in South Africa joins Tolulope Adeleru-Balogun who’s in the News Central studio in Lagos, Nigeria.
One of the factors responsible for this recovery is the rise in commodity prices which is helping South Africa see more inflow of revenue. “South Africa is a major commodity exporter”, Professor Rossouw says He adds also that while the new increase is welcome, the country will need more than that rate. South Africa’s population grow this at 1.5% our annum, so economic growth of 1.9% will be hardly enough to cater for sustained economic growth rate.”
He adds also that while sectors such as manufacturing and agriculture contributed to the improved GDP, the challenge facing the country is how to accelerate it for the greater good. “The South African government’s deficit before borrowing has grown substantially over the COVID period … and the government cannot continue like this.”
Watch the chat in full above.