By Reuters
South Africa’s economy unexpectedly shrank in the third quarter of this year as a drought caused a big drop in agricultural production, but analysts said they expected a return to modest growth in the coming quarters.
Data from Statistics South Africa showed gross domestic product (GDP) fell 0.3% in seasonally-adjusted quarter-on-quarter terms, whereas economists polled by Reuters had predicted an expansion of 0.5%.
Agriculture, forestry and fishing contracted 28.8% quarter on quarter, primarily due to field crops.
“Maize and soy account for about 70% of field crops and we know they have had a difficult quarter due to drought,” statistician Joe de Beer told a news conference.
Southern Africa has faced its worst drought in decades this year, hurting economic output across the region.
De Beer said the contraction in agriculture had pulled economic growth into negative territory.
“If we for a moment ignore the agricultural contraction… then
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