Statistics South Africa announced on Tuesday that South Africa has entered a technical recession with the second quarter of negative growth.
South Africa's gross domestic product decreased by 0.7% on a seasonally adjusted and annualised basis for the first quarter of the year. That’s after the economy contracted by 0.3% in the last quarter last year. In the first quarter, South Africa's economy grew by 1% year on year on an adjusted basis.
When you have an economy encased in a toxic political environment environment it is likely going to be the case that investment and spending will stutter. Not only are we in a technical recession, there is also momentum behind the slippage.— Goolam Ballim, Chief Economist, Standard Bank
Ballim tells Stephen Grootes, host of The Midday Report, that the contraction in the first quarter of 2017 was twice the pace of the contraction in the first quarter of 2016. He says looking beyond the numbers, South Africa's economy is weak and the quality of growth pitiful.
Its been almost three years that the economy has been unable to grow quicker than 2% over the last 24 months.— Goolam Ballim, Chief Economist, Standard Bank
Listen to the interview in the clip below: