Chief Economist at Efficient Group Dawie Roodt says South Africa’s economy is expected to have experienced its biggest drop in history during the second quarter of this year.
Roodts’ comments come as Statistics South Africa prepares to release the Gross Domestic Product number for the second quarter of 2020.
Statistician-General, @SGMaluleke will release the results of the Gross Domestic Product (GDP) for the second quarter of 2020.
— Stats SA (@StatsSA) September 7, 2020
The anticipated economic contraction results from the coronavirus lockdown which was implemented from March and saw nearly all economic activity halted.
Roodt says a 50% contraction can be expected in the second quarter.
“No economic model can accurately predict what the contraction and economic growth is going to be, but what we all know is that it’s going to be huge. This is gonna be ugly and it’s probably gonna be the worst ever in South Africa’s history. I expect round about 50%. And it really doesn’t matter whether it’s a 40% contraction or 60% contraction, it will be a lot. For the year, economic growth is likely to contract by 10% for the year in total. So 2020 will go down in history as the worst economic growth year for the South African economy.”
2% contraction in first quarter of 2020
South Africa’s economy contracted by 2% in the first quarter of this year.
This was largely attributed to significantly low production output in the mining, manufacturing and construction industries.
The video below provides a complete overview:
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