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The mining sector in South Africa continues to be battered as inflation and global demand for minerals continue to decline, coupled with geo-political and policy uncertainty across the globe.
The sector has been dubbed as a sunset industry in South Africa, however, government on the contrary says the sector still has a lot of potential to be revived and be the backbone of the country’s economy once again; reports show that agriculture has become the largest growing sector.
According to Statistics South Africa (StatsSA), Real Gross Domestic Product (GDP) grew by 0,6 percent in the fourth quarter of 2024. Three industries performed positively in two consecutive quarters of 2024; according to the report, these industries include agriculture, finance and trade industry.
Mining activity was softer in the fourth quarter, dragged lower mainly by manganese ore and iron ore. Platinum group metals and coal were the largest positive contributors, but their influence was not significant enough to push the industry into positive territory. The industry’s expansion in 2024 was mainly driven by chromium ore, platinum group metals and coal.
The report shows that mining and quarrying industry decreased by 0,2%. Decreased economic activities were reported for manganese ore and iron ore.
However, agriculture experienced the largest expansion in the fourth quarter in 2024. The agriculture, forestry and fishing industry increased by 17,2%, contributing 0,4 of a percentage point to the positive GDP growth. This was primarily due to increased economic activities reported for field crops and animal products.
The finance industry came in second which increased by 1,1%, contributing 0,3 of a percentage point, while trade grew by by 1,4%, contributing 0,2 of a percentage point.
The manufacturing industry decreased by 0,6%, contributing -0,1 of a percentage point to the positive GDP growth. Six of the ten manufacturing divisions reported negative growth rates. The largest negative contributions were reported for the basic iron and steel, non-ferrous metal products, metal products and machinery division and the motor vehicles, parts and accessories and other transport equipment division.
The electricity, gas and water industry decreased by 1,4%. This was largely due to decreases in electricity production and consumption.
The construction industry decreased by 0,4%. Decreases were reported for residential and non-residential buildings.
The transport, storage and communication industry decreased by 1,0%, contributing -0,1 of a percentage point. Decreased economic activities were reported for land transport and transport support services.
General government services decreased by 0,5%, mainly due to decreased employment in national and provincial government and extra-budgetary institutions. The personal services industry decreased by 0,2%. Decreased economic activities were reported for health and education.
