SA’s GDP growth welcomed with cautious optimism

Economist, Raymond Parsons, has welcomed with cautious optimism the growth of the country’s Gross Domestic Product (GDP) in the second quarter of 2019.

South Africa has avoided a technical recession following its GDP growth of 3.1%.

Data, released by Stats SA, show a positive growth in mining, manufacturing, finance and real estate, while agriculture, forestry and fisheries continue to shrink.

Parsons says despite the growth in figures, South Africa needs to work towards bettering the economy:

“That is good news in the sense that we have seen some positive growth in the 2nd quarter, after the shock of having a minus 3.2% growth in the first quarter. What we know about the current economic trends in SA is that we are probably not expecting a growth rate of 0.5/0.6% for this year as a whole. We still have to find ways and means of breaking out of this low growth and creating the jobs that we want. I think it is a question of how we build this little piece of good news that we brought about in the 2nd quarter of the year.”

Parsons says the recent attacks on foreign nationals and looting in Gauteng will not help contribute positively to the economic growth of the country.

More than 100 have been detained since the unrest began on Sunday. Five people were killed in riots in Johannesburg, where foreign-owned shops were targeted. Parsons says we need to ensure that law and order is maintained:

“These are not helpful factors, certainly under our control is that we need to ensure that there is social stability, law and order, certain segments of the business community are not singled out, it does not send out a good message. What we can do is say our house is in order, we are putting it in order, and we will be able to cope with any global headwind that might come. We can handle it a lot better if we are seen to be on the way towards creating a bigger, stronger and better economy.”

Watch a related video below: