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South African economy faces a huge blow as recession affect the trading sector. Photo Courtesy: Eric Sepanek/ Scottsdale Bullion & Coins

The second quarter GDP data has shown that South Africa has moved out of technical recession with growth of 2.5% in the second quarter of this year.

Statistician-general Pali Lehohla announced the second quarter gross domestic product figures at a briefing in Pretoria on Tuesday.

Lehohla says the economy grew quarter-on-quarter as well as year-on-year.

“GDP quarter-on-quarter is 2.5%. Year-on-year it is 1.1% and six months-on-six months is 1.1%. The growth rate, historically, we see that we had two quarters that put us in a technical recession, which with this quarter we are out of.”

He spoke about how several sectors contributed to the positive growth.
“And we can see that primary industries contributed 10.3%, secondary industries 1.9% growth and tertiary industries 1.2%. So the primary industries, namely agriculture and so on, contributed quite significantly.”

The economy experienced uninterrupted negative growth in the last quarter of 2016 and the first quarter of 2017.

The latest figures exemplify a year-on-year growth of 1.1%.
It was mentioned that agriculture was a major contributor.
Stats SA’s latest GDP figures show that agriculture was the major contributor to the 2.5% quarter-on-quarter growth.

Lehohla says that primary industries made the biggest contribution to the 2.5% quarter growth.

The agricultural sector grew by 33% over the period, while the finance sector increased by 2.5%.

The only negative growth experienced was in the government and construction sectors which thin by 0.6% and 0.5% respectively.

Chief economist at Econometrix, Dr Azar Jammine, warns consumers not to celebrate just as yet.
“Times are going to remain tough. If one looks at it over a longer period of a time, we are talking about the economy growing by around 1% in the first half of the year – which is clearly insufficient when the growth in the population is 1.7%,” he explains.

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