South Africa's economy declined by 2.2% in the first quarter of this year, recording the largest quarter-on-quarter shrink since the first quarter of 2009, when the economy contracted by 6.1%. The national statistics agency (Stats SA) revealed.

“After growing by 3.1% in the fourth quarter of 2017, the South African economy wobbled in the first quarter of 2018, shrinking by 2.2%,” the agency said.

This economy disappointment is mainly due to a sharp drop (-24%) in agriculture output during the period under review.  “Agriculture’s relatively strong performance in 2017 is one of the positive factors that helped keep the economy afloat in 2017. This momentum failed to carry through to 2018, with decreased production in field crops and horticultural products,” Stats SA indicated.

It was also driven by other sectors such as mining industry which shrunk by 9.9%, manufacturing (-6.4%) and construction (-1.9%).  It should however be noted that services and financial segments slightly grew by 1.8% and 1.1%, respectively.

This situation could hinder the economy’s revival strategy initiated by the current president Cyril Ramaphosa whose priorities include addressing corruption and economic issues in South Africa.