When Did the Recession Start in South Africa
South Africa has suffered greatly as a result of the global financial crisis. 1 For the first time in 17 years, the economy experienced a recession in 2008–2009. Just in 2009, about a million jobs were eliminated. Growth has restarted, but the recovery is shaky and another recession might be on the horizon.
What is a recession
When an economy contracts for two successive quarters, or two consecutive three-month periods, it is said to be in a recession. Although a recession is a recession, finish and klaar, the vocabulary used in public speech sometimes refers to a “technical recession.”
In simple terms, a recession occurs when the economy’s performance declines over a protracted period of many months, as seen by a reduction in GDP, an increase in the unemployment rate, and decreased consumer expenditure. A recession may cause people to experience substantial effects on their day-to-day activities.
What led to the recession in South Africa?
The worldwide downturn following the global financial crisis, falling commodity prices, deindustrialization, “state capture” (systemic corruption), budget cuts, restrictive macroeconomic policies, and sluggish investment due to economic stagnation were all precipitating factors.
The result of ten years of recession
South Africa’s lack of structural change had the effect of placing the nation in a fragile economic situation even before the pandemic. At the end of 2019, stubbornly high jobless rates were already at 29.1%. Unacceptably high levels of poverty persist. In 2015, 30.4 million individuals lived below the official poverty line, with female-headed households having a greater rate of poverty than male-headed households (49.9% against 33.0 percent).13.8 million people, or 25 percent, were considered to be in “severe poverty,” meaning they were unable to purchase enough food to meet their basic needs.
What is the current state of the SA economy?
In 2019, South Africa’s real GDP grew by 0.2%. The economic impact of the pandemic and containment measures to stop the virus’s spread was increased. Construction, transportation and communication, manufacturing, and mining all experienced declines in 2020, leading to an 8.2% decrease in real GDP.
The Impacts
On both a global and local level, the 2008 recession had a significant impact on employment. It has been estimated that over the course of the following 18 months, approximately 34 million jobs were lost worldwide, with 1 million of those losses occurring in South Africa alone.
What happened to South Africa’s economic development in 2009?
The global recession brought about South Africa’s first recession in 17 years. After a decade of continuous expansion, real GDP growth decreased by 2% in the first half of 2009. Numerous unfavourable domestic events that occurred at the same time as the global crisis added to the severity of the current recession.
