South Africa's economy shrinks by more than expected

In contrast to expectations, South Africa's GDP declined by 1.3% in the fourth quarter of 2022.

Analysts expected a drop of just 0.4% and attributed the significant decline in productivity to the record blackouts.

The industry would inevitably suffer as a result of the rolling blackouts. In the final three weeks, there were only two days without electricity outages.

The disruptions have rendered businesses helpless, and as a result, output costs have increased as a result of the need to buy backup power.

The final three months of 2022 saw a decline in seven of South Africa's ten sectors. The largest losers were the mining and agribusiness sectors, both of which experienced declines of over 3%.

Overall the South African economy grew by 2% in 2022, but is still well below the 5 to 6% target band that economists say will make a dent in the country’s 33% unemployment rate.