Recent GDP growth outcomes exceed expectations despite record power outages

Arnold Khoza, Mokgabiso Tshenkeng and Sumaiya Sidat Kgotso Morema

No 11052, Occasional Bulletin of Economic Notes from South African Reserve Bank

Abstract: Despite ongoing weakness, GDP growth has been unexpectedly higher during the first half of 2023 as the mining, manufacturing and finance sectors outperformed expectations. Meanwhile, on the demand side, better than expected growth from government expenditure and private sector gross fixed capital formation was realised. Better-than-expected growth outcomes can be ascribed to firms adapting to load-shedding; Eskom reducing its planned maintenance to improve generation capacity and relying more on its Open Cycle Gas Turbines; and increases in self-generating rooftop solar power and wind energy. This occurred amidst trading partner growth resilience. Looking ahead into 2024, GDP growth outlook remains weak, but risks to the outlook are still balanced.

Date: 2024-04-25
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