The real truth about the SA economy - Facts about the SA economy, provided courtesy of the economics division of Stanlib. This, in a nutshell, is the true state of the SA economy. And it is against this background that you need to make your investment decisions. Good luck *The industrial base of the economy has been under pressure for many years. Consequently the services sector has out-performed and now represents around 70% of the economy. *Economic activity remains concentrated in Johannesburg, Cape Town and Durban. Together these three provinces represent almost 70% of the economy. The platteland is becoming a wasteland. *The SA economy is the largest it has ever been, in both nominal and real terms. Although GDP growth has recovered from the pre 2009-levels and is now slowing, employment remains below the pre-crisis level. *SA’s economic recovery has been consumption-based rather than production-based. *Gold output has been in structural decline for many years. SA is now the sixth largest producer of gold in the world. *Mining activity is essentially unchanged over the past 15 years, despite a boom in commodities all over the world. *Manufacturing has been in structural decline for the past 20 years. *Agricultural output has trended sideways for ten years, despite the need for more food production. *Consumer activity is slowly losing momentum after a good recovery in 2010 and 2011. The slowdown is driven by a fall-off in household income growth. *Although SA is a member of the G20 and BRICS, the economy represents less than 1% of the world economy. This percentage has not changed significantly in the past 30 years. *After growing rapidly in the 1950s and 1960s, the SA growth rate stalled in the late 1970s and in most of the 1980s, hurt by escalating political turmoil. The growth rate picked up in the 2000s, but has lacked momentum in recent years. *SA is considered a low growth economy by emerging market standards and even though GDP per capita has grown in real terms, the unemployment rate has risen to record levels. China still leads the pack followed by some of the African countries such as Ghana and Nigeria.
Posted on: Wed, 24 Jul 2013 14:07:50 +0000
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