South Africa's economy stagnates with mere 0.1% GDP growth in 01. raising concerns

Experts united in their concern about stagnation in the economy, as country narrowly misses contraction

- YOGASHEN PILLAY

SOUTH Africa's economy narrowly escaped contraction in quarter one 2025, with gross domestic product (GDP) growing by a mere 0.1%, down from 0.4% in quarter four 2024, according to Statistics SA Experts were united in their concern about stagnation in the economy.

Maarten Ackerman, the chief Economist and Advisory Partner at Citadel, said the figures are "not something to celebrate," as the country remains in a prolonged per capita recession, with full-year growth at just 0.8%.

Agriculture, forestry and fishing industry increased by 15.8%, contributing 0.4 of a percentage point to the positive GDP growth. This was primarily due to increased economic activities reported for horticulture and animal products.

The transport, storage and communication industry increased by 2.4%, contributing 0.2 of a percentage point.

Increased economic activities were reported for land transport, air transport and transport support services.

Stats SA said the finance, real estate and business services industry increased by 0.2%, contributing 0.1 of a percentage point. Increased economic activities were reported for retail trade, motor trade, accommodation and food and beverages manufacturing industry decreased by 2.0%, contributing -0.2 of a percentage point.

The Seven of the ten manufacturing divisions reported negative growth rates.

The largest negative contributions were reported for the petroleum, chemical products, rubber and plastic products; food and beverages; and motor vehicles, parts and accessories and other transport equipment divisions.

Mark Phillips, the head of Portfolio Management and Analytics at PPS Investments, warns that despite agriculture's impressive 15.8% surge, the economy is showing signs of serious strain.