South Africa’s economy grew by 0.6% in the fourth quarter of 2024 following a contraction of 0.1% during the previous quarter.
This is according to the latest gross domestic product (GDP) data released by Statistics South Africa on Tuesday.
“Growth was led by agriculture, finance and trade on the supply (production) side of the economy. Household spending led growth on the demand (expenditure) side,” Stats SA said.
Agriculture had the most significant positive impact on GDP growth on the supply side of the economy. Following a sharp decline in the third quarter, the industry rebounded by 17.2%, lifting GDP growth by 0.4 of a percentage point. This was mainly due to a rise in the production of field crops and animal products.
The finance, real estate and businesses services industry grew for an eighth consecutive quarter, with financial intermediation, real estate activities and other business services the largest positive contributors to growth.
The trade industry expanded on the back of increased retail, wholesale and motor trade sales. This reflected positively on the demand side of the economy, with household consumption spending rising in the fourth quarter.
Seven industries performed poorly, with manufacturing and transport, storage and communication the most significant negative contributors to growth. Manufacturing was mainly pulled lower by weaker production levels in the metals and machinery and automotive divisions.
Transport, storage and communication recorded a fourth consecutive quarter of decline. The industry witnessed a pullback in land transport and transport support services.
Mining activity was down on weaker production levels for manganese ore, iron ore, gold, chromium ore, nickel and copper. Coal and platinum group metals were positive, but not enough to keep the industry above water.
The demand side of the economy – measured by expenditure on GDP – was mainly lifted by a rise in household consumption spending.
“Households spent more on a range of products, most notably, clothing and footwear, food and non-alcoholic beverages, recreation and culture, and household goods,” Stats SA said.
“The data suggests that consumers might have more breathing space than they did a year ago. In real terms, households spent 2.3% more in the fourth quarter of 2024 compared with the fourth quarter of 2023.”
The trade industry grew by 1.6% over the same period, while the economy witnessed a R16.4 billion drawdown in inventories, in part due to the trade industry accelerating efforts to meet demand that exceeded supply.
“Mining also drew from its stockpiles to address a rise in export demand while production lagged, contributing to the overall drawdown in inventories,” Stats SA said.
Investment in infrastructure and other fixed assets (gross fixed capital formation) was weaker in the fourth quarter, mainly because of a decline in residential buildings, machinery and other equipment, and non-residential buildings.
