Real Gross Domestic Product (GDP) fell 0.6 percent in the first quarter of the year and then rose in the second quarter by an annualised rate of 0.6 percent, according to the bank’s Quarterly Bulletin.
“This barely positive growth rate was extremely disappointing given the country’s development needs, and was mainly brought about by the drawn-out industrial action in the platinum-mining subsector which started on 23 January 2014 and only came to an end five months later.”
South Africa would have been considered to be in a recession had there been two consecutive quarters of negative growth.
The GDP is the total value of goods and services produced in an economy over a certain period.
The bank said the platinum sector strike, which resulted in a sharp contraction in mining output in the first quarter, led to a “further but less drastic decline” in real mining production in the second quarter.
The conditions extended to the electricity sector, where weakness in demand was amplified by a relatively mild winter and a higher real price of electricity.
“By contrast, the agricultural sector registered stronger growth in real output over the period, supported by a bumper maize crop.”
A decline in commerce sector activity and slower growth in the real value added by the financial services sector were offset by growth in the transport and general government services sectors in the second quarter.
The SARB said growth in real final consumption expenditure by households decelerated further in the second quarter.
This was consistent with the deceleration in the real disposable income of the household sector as industrial action detracted from striking workers’ earnings.
Growth in the general government service sector’s real final consumption expenditure accelerated slightly in the second quarter, partly because of the national and provincial elections in May.
The country’s export performance in the second quarter was inhibited by strikes, logistical and energy constraints, a moderation in global demand, and a decline in some commodity prices.
SARB said employment trends reflected the generally subdued growth in economic activity.
“Enterprise-surveyed employment in the formal non-agricultural sector rose somewhat over the most recently available four quarters to the first quarter of 2014, but all the job creation took place in the public sector,” it said.
“Household-surveyed employment statistics suggest more vigorous increases in employment in the year to the second quarter of 2014.”
SARB said the number of work days lost to industrial action had escalated since the beginning of the year.
“Average wage settlements increased moderately over the past year, although a number of high-profile settlements were in double-digit territory.”
It said fiscal policy continued to provide support to economic recovery.
“The public-sector borrowing requirement amounted to 4.6 percent of gross domestic product in April/June 2014, slightly higher than a year earlier.
“Both general government and the non-financial public corporations continued to incur more expenditure than their current revenue as they aligned their infrastructure and other programmes with the targets set out in the National Development Plan.
“In the most recent quarter, however, general government raised its share of the borrowing requirement whereas public corporations decreased.”