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South Africa records marginal Q1 growth on back of power crisis

Published

2 years ago

June 6, 2023

Despite a steep power crisis, South Africa recorded marginal economic growth in 2023 which helped it escape recession in the period.

According to the official state data source, eight of the ten industries experienced growth between January and March, with manufacturing and finance, real estate, and business services contributing the most. Manufacturing output increased by 1,5%, adding 0,2 of a percentage point to GDP growth. The production of food and beverages was the main catalyst behind the industry’s positive showing.

The transport sector was inspired by the rise in rail freight and rail passenger transport while the storage & communication industry expanded by 1,1%.

Finance, real estate & business services grew by 0,6%, mainly driven by financial intermediation, insurance & pension funding, real estate and business services. Personal services also increased by 0.8%, owing to increased community service activity.

South Africa’s Statistician-General, Risenga Maluleke said food and drinks manufacturing had performed particularly well, partly because the sector was not as electricity-intensive as other types of manufacturing.

“Household consumption was driven largely by restaurants and hotels, and when you look at that, with load-shedding (power cuts), where do people get their food? They have to call on Uber Eats or order from restaurants,” Maluleke said.

Meanwhile, experts have argued that the economic situation remains dire despite the marginal growth.

An economist, Jason Tuvey quoted by Reuters, said “The outlook remains bleak. Severe power cuts, tight fiscal and monetary policy and a worsening external backdrop mean that the economy is likely to merely stagnate this year.”

As one of Africa’s most industrialized economies, power outages have posed a threat to businesses and the country’s overall economy. South Africa’s state utility firm, Eskom recently announced that its power rotation had been suspended “until further notice”.

Related Topics:Economy growth Featured South Africa

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Moroccan annual inflation rises to 0.8% in November

Published

2 days ago

December 21, 2024

Ifeoluwa Dada

Morocco’s statistics office has confirmed that the country’s annual inflation rate, as determined by the consumer price index, increased from 0.7% in October to 0.8% in November.

Monthly, consumer prices decreased by 0.2% from October.

The primary driver of inflation, food costs, grew by 0.8% compared to the previous year, while non-food inflation climbed by 0.7%. Core inflation, which does not include more erratic items like food, increased 2.6% annually and 0.2% monthly.

According to the central bank, inflation is expected to average 1% this year, down from 6.1% last year.

Despite the Al-Haouz earthquake, a spike in inflation, and worldwide economic challenges, Morocco’s GDP grew by 3.4% in 2023.

A recovery in tourism, robust industrial exports, and rising private consumption—all bolstered by prudent macroeconomic policies—were the main drivers of growth.

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Nigeria’s $42bn foreign reserves enough for 9 months’ imports— Central Bank

Published

3 days ago

December 20, 2024

Ifeoluwa Dada

According to Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), the nation’s $42.01 billion in foreign reserves can cover imports of goods and services for almost nine months.

Cardoso promised Nigerians improved economic fortunes in 2025 while addressing the Senate Committee on Banking, Insurance, and Other Financial Institutions yesterday in Abuja at the presentation of the performance index report.

Cardoso stated: “External Reserves rose from $ 38.35 billion it was on September 30, 2024, to $ 42.01 billion as of December 12, 2024”.

He clarified that third-party receipts in Q3 2024 and revenues from taxes connected to crude oil were the main drivers of the rise in foreign reserves during the specified time.

“We saw remarkable improvements in our trade balance and maintained a current account surplus,” he added.

“Our external reserves level can finance over 9.09 months of import of goods and services or 13.91 months only, higher than the international benchmark of 3.0 months and a robust buffer against shocks”.

On cash shortage, the CBN boss reiterated the N150 million fine against any branch of banks caught illegally distributing new Naira notes to currency hawkers and unscrupulous elements and said the Nigerian economy will improve in 2025 through policies and measures.

He predicted a stronger economic future: “Despite our economy’s challenges, there are clear reasons for optimism.

“The gradual stabilization of the forex market, ongoing banking sector recapitalization, and positive growth trends in key sectors, especially the services sector, indicate a path toward recovery and stability.”