ECONOMIC WEEK AHEAD: Mining data to lag, manufacturing likely to hit 2008 lows
Mining, manufacturing and energy sectors reel from the impact of unprecedented load-shedding during the first quarter of the year
A cocktail of negative domestic and international factors tipped the mining and manufacturing sectors into contraction during March. It also set the manufacturing sector on course for its worst performance since the 2008/2009 global financial crisis. The energy-intensive sectors were at the mercy of Eskom’s load-shedding schedule, which ramped up to the severe and unprecedented stage four level — removing 4,000MW from the national grid — for an entire week during March. The effect of electricity shortages, coupled with low household and corporate confidence, weaker domestic and global demand, higher electricity tariffs and rising fuel prices, are is forecast to have resulted in manufacturing contracting 8.4% quarter on quarter, which has been adjusted for seasonal variations. Elize Kruger, a senior economist at NKC African Economics said this would be the sector’s “worst performance since the global financial crisis”. This is against growth of 4.5% in the last quarter of 2018. The...
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