Main Bulletin: The Real Economy Bulletin - Third Quarter 2022

In this edition

GDP growth: GDP grew by 1.6% in the third quarter of 2022, an unexpectedly strong performance in light of intensified loadshedding and continuing volatility in the global economy. Agriculture grew most rapidly, at an exceptional 19%, while the rest of the economy expanded far more modestly. For the first time, the GDP has now exceeded pre-pandemic levels. Read More

Employment: According to the Quarterly Labour Force Survey (QLFS), in the third quarter of 2022 the formal sector employed around 615 000 fewer people than in the third quarter of 2019. There has, however, been a significant recovery from the third quarter of 2021 with close to 1.5 million jobs gained, led by robust recoveries in white collar jobs and in the informal sector. Domestic workers have continued to experience job losses this quarter, with no sign of recovery to pre-pandemic levels. The response rate for Stats SA’s QLFS has continued to improve, rising from 79% in the second quarter of 2022 to 85% in the third quarter of this year, approaching pre-pandemic rates. Read More

International trade: South Africa’s surplus in goods trade continued to narrow in the third quarter as prices for key export commodities declined, with the exception of coal, while imports climbed. Logistics challenges have affected coal and auto, and imports have grown faster than exports across most manufactured goods categories. In these circumstances, soaring coal prices have not been sufficient to maintain the record trade surpluses seen since the pandemic. Read More

Investment: Investment in the third quarter of 2022 grew 0.3%, with private investment contracting slightly and public investment expanding sharply for the first time in a decade. The investment rate maintained the 14% level from the previous quarter, up from 13% in the third quarter of 2021 – still far below the level of around 20% required for steady growth. Returns on assets climbed sharply in manufacturing and the rest of the economy outside of mining and construction. Despite the decline in mining, profitability remained very high by historic standards. Read More

Foreign direct investment projects: The TIPS Foreign Direct Investment Tracker monitors FDI projects on a quarterly basis, using published investment information. Twelve projects were added to the Tracker in the third quarter of this year. The pledged investment value recorded for the third quarter of 2022 was just over R22.6 billion, captured from nine projects. Information was updated for nine investments previously captured in the Tracker. Read More

Briefing Note: JETPs - just transition finance blueprints or business-as-usual?  - by Gaylor Montmasson-Clair and Muhammed Patel. Just Energy Transition Partnerships (JETPs) have emerged as a mechanism to foster the transition in the Global South. Following on the announcement at COP26 of the US$8.5 billion JETP for South Africa (with the UK, Germany, France and the US along with the EU), Indonesia struck a US$20 billion deal at COP27. Many others could follow, from India, to Vietnam, to Senegal. With such arrangements becoming more prevalent, it is worth taking a closer look at South Africa’s JETP, the most advanced of the partnerships to date. Read the Briefing Note online: JETPs - just transition finance blueprints or business-as-usual.

Briefing Note: Economic implications of the 2022 MPBPS - by Nishal Robb. The 2022 Medium Term Budget Policy Statement (MTBPS) reaffirms National Treasury’s commitment to pursue steep budget cuts over the next few years despite the negative social and economic outcomes that the cuts are likely to produce. Read the Briefing Note online: Economic implications of the 2022 MPBPS.