Some South Africans may be reconsidering how they spend their cash as SA entered a second recession in two years.
Image: 123RF/Peter Titmuss.
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South Africa entered its second recession in two years in the final quarter of last year, data released by Stats SA showed on Tuesday.

The economy declined by 1.4% from a revised contraction of 0.8% in the previous quarter.

The data showed that agricultural output declined by 7.6%, transport by 7.2%, construction by  5.9%, electricity by 4% and retail by 3.8%.

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GDP overall declined by 0.5% year-on-year in the fourth quarter, after expanding 0.1% in the previous quarter.

The South African economy managed growth of just 0.2% for 2019, down from 2018’s 0.8%, and  this makes it the sixth consecutive year that it has grown below 2% and is the lowest level of growth since 2009 when the economy contracted by 1.5%.

While many have expressed concerns about the future, finance minister Tito Mboweni said the South African economy is strong enough to recover.

President Cyril Ramaphosa said South Africans should not be shocked or act surprised by the recession because the signs were there.

According to him, several factors, including poor business and consumer confidence, and lack of production due to Eskom's load-shedding, led to the technical recession.

“This technical recession has been there for all of us to see. It's been the load-shedding and the impact it has on production.”


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