South Africa’s economic growth ground to a halt in the third quarter, shrinking by 0.2% compared to the previous three months, according to Statistics South Africa.
All sectors except finance contributed to the GDP decline. Agriculture, manufacturing, mining, construction, and trade all experienced negative growth, indicating widespread weaknesses.
The logistics crisis, characterized by port congestion and container shortages, is believed to be a major culprit behind the sluggish performance. This bottleneck has hampered export capacity, hindering the ability of key industries to capitalize on global demand.
The government has acknowledged the seriousness of the logistics crisis and has pledged to take steps to address it. However, many businesses remain skeptical, citing a lack of concrete action and continued delays in resolving port issues.
The Reserve Bank has already revised its GDP forecast for the year downwards, and further downgrades seem likely if the logistics problems persist.
GDP | Third quarter 0.2% contraction indicates stagnating economy