The diverse structure of the South African economy is a critical aspect of its historical and current growth performance. The manufacturing sector continues to occupy a significant share of the South Africa economy, despite its relative importance declining from 19 percent in 1993 to about 17 percent in 2012 in real terms.
In line with structural changes in many economies, it not surprising to observe that the finance, real estate and business services sector has increase its relative importance of 17 per cent in 1993 to approximately 24 per cent in 2012. These two sectors and a few more are an important part of the South African growth story since the dawn of democracy.
Despite that, less than a decade into the 21st century, many countries, including South Africa, experienced the global economic crisis.This has affected economic growth in South Africa over the last four years, prompting a deceleration in rate of economic growth.
South Africa experienced an average growth rate of approximately 5 per cent in real terms between 2004 and 2007. However, the period 2008 to 2012 only recorded average growth just above 2 per cent; largely a result of the global economic recession.
Of the nine provinces in South Africa, three power houses stand out. Gauteng, Kwazulu-Natal and Western Cape collectively contribute a significant portion to the country’s value added, reported at over 60 percent.
Before the slump in 2008/09 due to the global recession, manufacturing performed well, recording annual growth rates of 2,9%, 4,6% and 4,2% for 2005, 2006 and 2007 respectively. The recovery after the recession from 2010 to 2012 was sluggish, and 2013 showed anaemic annual growth of 1,3% to date. Factory output remains far from the read more »