Economy registers 0.1% weak growth in first four months

 

Latest quarterly data provided by the statistician general, Alex Shimuafeni, shows that activities in the local economy declined by 0.1% in the first quarter of 2018, an improvement from that of 0.4% registered in 2017. 

“The performance is largely driven by construction sector that posted strong growth of 23.7 percent in real value added relative to the contraction of 36.9 percent recorded in the corresponding quarter of 2017. Furthermore, slight improvements were observed in the ‘wholesale and retail trade’ and ‘transport and communication’ sectors,” said Shimuafeni.

The wholesale and retail sector continued to struggle with a negative growth of just 1.3% which shows that demand  is still very weak although there are some signs of recovery when compared to the same period in 2017.

The transport and communications sector registered a growth of 2.5% during the period under review.

Shimuafeni said government’s fiscal consolidation has dragged the economy down.

  Growth in the agriculture and forestry sector also slowed down posting a growth of   1.4% “in real value added during the quarter under review in comparison to a strong growth of 16.5 percent recorded in the corresponding quarter of 2017,” says the quarterly report.

It further says that the notable slow performance in the sector is mainly driven by the livestock farming subsector that decelerated to 1.9% compared to a strong growth of 19.3% recorded in the same quarter of 2017.

Decreasing livestock numbers have been caused by exports to South Africa that have increased which has caused a decline in inventory and disinvestment in stock.

The fishing sector also declined by 13.6% in real value added as compared to a growth of 5.9% last year due to “backdrop of declining fish landings accompanied by rising fuel costs and currency appreciation remains the limiting factors”.

Mining and quarrying also slowed down to 4.7% compared to last year’s 14.0% while manufacturing also declined to 2.1% in real value added compared to a strong growth of 3.9% last year.

After having registered declines for the past eight consecutive quarters, the construction sector recovered by registering a strong growth of 23.7% in the first quarter of 2018.

Meanwhile, real economic growth for the fourth quarter of 2017 has been revised downward to negative 1.5% from a contraction of 1.0% previously recorded, representing a decline of 0.5 percentage points.