South Africa's economy returns to pre-pandemic
levels with 1.9 percent growth rate in Q1

South Africa's gross domestic product (GDP) grew by 1.9 percent quarter on quarter in the first quarter of 2022, marking a second successive quarter of positive growth, Statistics South Africa (Stats SA) reported Tuesday.

Real GDP is now a bit higher than it was pre-COVID-19, which means the economy is now back at pre-pandemic levels, said the Stats SA.

Manufacturing was the star performer in the first quarter, which saw strong growth of almost 5 percent, as eight of the ten industries recorded positive growth. The manufacturing sector boom was driven mainly by the increased production of oil and chemicals, foods and beverages, and metals and machinery.

A notable contribution to the GDP growth was also made by finance, real estate, and business services.

The first quarter saw a healthy increase in wholesale, retail, motor trade, and catering and accommodation.

In its latest release, Stats SA explained that these figures only cover the first quarter of the year which means that the effects of the devastating floods would only be seen in the second quarter.

"This means that the economic impact of the devastating floods in KwaZulu-Natal (KZN), which occurred during the second quarter in April, will only reflect in the GDP results due for release in September," it said.

The flood damage in KZN is estimated to run into billions of rands as more road infrastructure has been damaged, more than 40,000 people have been displaced, and over 4,000 homes have been destroyed.

As of the latest figures released, the unemployment rate decreased by 0.8 of a percentage point to 34.5 percent in the first quarter of 2022. While the GDP is predicted to grow by 2.1 percent this year, it is not expected to reach the nearly 5 percent growth achieved in 2021.