GDP collapses 51% in the second quarter

South Africa’s Gross Domestic Product (GDP) for the second quarter of 2020 shrank by a mammoth 51%, mainly as a result of the Covid-19 lockdown coming into effect during that period, a report by Stats SA shows.

The quarter-on-quarter seasonally-adjusted annualised GDP is adjusted for inflation and seasonal changes, was expected to show a sharp decline on that for the first quarter, as a result of the five-week long lockdown bring a halt to most economic activity.

The 51% drop was not far off from the 50% fall predicted by Efficient Group chief economist Dawie Roodt on the MoneyWebNow podcast, on Tuesday morning.

Roodt did expect the lifting of some the lockdown restrictions to lead to a recovery in the third quarter, but expected GDP for the year to be down about 10% for the year.