Retail sales slow to 8.8%

14 December, 2006 at 10:12 am | Posted in Economy | Leave a comment

The World Bank estimates that South Africa’s economy grew 4.6 percent this year. And it predicts growth will slow to less than 4 percent next year.

The figures appear in Global Economic Prospects: 2007, published on the bank’s website yesterday. Projections are built on an analysis of short-term prospects and the estimate may be on the low side because it would have been based on figures that have been revised upwards. On November 29 Statistics SA published benchmarking revisions to figures on gross domestic product (GDP). These put growth in the first half of this year at 4.4 percent rather than 3.8 percent. Growth last year was revised up to 5.1 percent from the 4.9 percent estimate published in February. In 2004 it was 4.8 percent, up from 4.5 percent; and in 2003 3.1 percent, up from 3 percent.

Jac Laubscher, a Sanlam group economist, believes the World Bank prediction is too pessimistic – his estimate for next year is 4.3 percent. He expects growth in the domestic economy to come from an acceleration in capital expenditure. “The extent of it will depend on how successful government is in implementing its infrastructure plans.” Impetus will also come from an improved export performance and slower import growth, following this year’s depreciation in the rand.

The World Bank estimates GDP in sub-Saharan Africa will have increased “an impressive 5.3 percent in 2006, down marginally from 5.5 percent in 2005” and marking the third year of growth above 5 percent. The deceleration is due to slowing growth in South Africa because of weaker performance in the mining sector and poor crops. Excluding South Africa, regional growth was steady at 5.8 percent and oil exporters grew 6.9 percent. “Encouragingly, this strong growth has been broadly based, with a third of countries experiencing in excess of 5 percent,” the report says. It identifies six countries experiencing a decline in per capita income: the Republic of Congo, Eritrea, Gabon, the Seychelles, Swaziland and Zimbabwe.

The bank predicts growth in sub-Saharan Africa will remain above 5 percent over the next two years. It expects small oil importing countries to grow by about 4.8 percent while growth in oil exporters accelerates, owing to “increasing capacity in Angola and Equatorial Guinea, as well as a normalisation of production levels in Nigeria”. The report presents scenarios for the next 25 years and discusses how developing countries will move to centre stage in the global economy. It discusses “managing the next wave of globalisation” and analyses the opportunities the process will create, as the world’s population rises from about 6.5 billion to 8 billion by 2030 – with more than 97 percent of the growth in developing countries. “While rich and poor countries alike stand to benefit, certain stresses already apparent today – in income inequality, in labour markets and in the environment – will become more acute,” it says. Africa is at risk of being left behind. And, though many in the developing world are likely to enter “what can be called the global middle class”, income inequality could widen.


I still think such statistics are interesting to know, but your own research will stand you in much better stead than numbers out from Stats SA.


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