Economy

GDP growth welcome but not enough to create jobs - FEDUSA

GDP growth welcome but not enough to create jobs - FEDUSA”

South Africa had been in a technical recession given the contraction for two consecutive quarters.

The announcement was made by statistician general Pali Lehohla on Tuesday, while releasing figures on the growth domestic products for the second quarter.

Indeed, Nigeria owes the improvement to a boost in its oil and agricultural productions as well as a burst in its foreign exchange reserves, which should sustain its economic growth.

Oil GDP recovered significantly from -11.63 per cent in Q2 2016 to 1.64 per cent in Q2 2017, while Non-oil GDP grew marginally at 0.45 per cent.

In addition, first-quarter 2017 GDP was revised downwards, "so the picture is weaker than expected".

This in effect means that the Nigerian economy has exited recession after five successive quarters of contraction.

"The major driver of growth in the non-oil sector was the Agriculture Sector (Crop Production), finance and insurance, electricity, gas, steam, air conditioning supply and other services", the report stated, adding that the non-oil sector grew by 0.45 per cent in real terms during the quarter.

South Africa's economy has experienced sluggish growth in recent years with the jobless rate rising to 27.7 percent.

"This is not at all a robust GDP print", said Razia Khan, chief economist for Africa at Standard Chartered.

"As a share of the economy, the oil sector contributed 8.89% of total real GDP in Q2 2017, up from Q2 2016 and preceding Q at 8.79% and 8.53% respectively". Growth also rose by 17.24% when compared to Q1 2017.

President Jacob Zuma last month said that 2017 growth would be below 0.5 per cent, down from a forecast of 1.3 per cent in February, after the poor first quarter numbers. As a nation, the goal of achieving and sustaining higher rates of economic growth and development remains just as important as ever.

But that recovery failed to drive a strong rebound in overall economic growth.



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