SA economic growth stagnant in first quarter
South Africa's economy avoided a contraction in the first quarter of 2025, growing by just 0.1% between January and March.
Statistician-General Risenga Maluleke released the latest gross domestic product (GDP) figures on Tuesday, showing that the economy continues to face pressure despite a slight improvement.
This follows growth of 0.4% in the fourth quarter of 2024.
On the production side, only four out of ten industries recorded positive growth, with the agriculture, forestry and fishing sector emerging as the strongest performer.
The sector grew by 15.8%, contributing 0.4 of a percentage point to overall GDP growth.
“This was primarily due to increased economic activities in horticulture and animal products,” said Maluleke.
The transport, storage, and communication industry increased by 2.4%, adding 0.2 percentage points to GDP.
Land and air transport and transport support services drove growth.
The finance, real estate and business services sector grew by 0.2%, contributing 0.1 of a percentage point, mainly due to increased activity in insurance, pension funding, and auxiliary services.
The trade, catering and accommodation industry also recorded growth of 0.5%, contributing 0.1 of a percentage point, boosted by improved performance in retail trade, motor trade, accommodation, and food and beverages.
Manufacturing, mining and government spending decline
On the downside, the manufacturing industry contracted by 2.0%, subtracting 0.2 of a percentage point from GDP.
“Seven of the ten manufacturing divisions recorded negative growth,” said Maluleke.
“The largest declines were reported in petroleum, chemical products, rubber and plastics; food and beverages; and the motor vehicles and transport equipment sectors.”
The mining and quarrying industry also declined sharply by 4.1%, contributing -0.2 of a percentage point, largely due to decreased production in platinum group metals.
Final consumption expenditure by general government decreased by 0.1%, mainly driven by reductions in compensation of employees and purchases of goods and services.
Household spending remains positive
On the demand side, household final consumption expenditure increased by 0.4%, contributing 0.3 of a percentage point to overall growth.
Positive growth was recorded in spending on durable goods, non-durable goods, and services.
“The main contributors were transport (up 1.1%), food and non-alcoholic beverages (up 0.5%), restaurants and hotels (up 1.4%), health (up 0.8%), and miscellaneous items,” said Maluleke.
However, spending on recreation and culture, communication, housing, water, electricity, gas and other fuels declined, dragging down household consumption.
Despite the narrow growth, the data reflect a fragile economic recovery, with substantial gains in agriculture and consumer spending countered by declines in key sectors like manufacturing and mining.
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