The country’s GDP has reported positive economic growth for the first quarter of the year; and Durban has also reported above average growth. However, Durban’s economy hasn’t reached pre-Covid GDP levels. Durban’s GDP is still (0,8%) R3,7 billion below pre-COVID-19 GDP levels. Durban’s quarter-on-quarter growth increased by 2,3%, following growth of 1,6% in the previous quarter.
Eight sectors contributed to 2022Q1 growth, with manufacturing contributing (0,38%), followed by finance (0,42%), and trade (0,38%). The performance of manufacturing is particularly impressive. Should the sector maintain this level of growth for the remainder of 2022, it would expand by a fifth of its size (20,6%); and reach pre-Covid levels (GVA of R73,5bn, rebased). Negative growth was seen in construction (- 0,03%) and no growth in mining industry. Construction and mining have reported negative growth for three consecutive quarters.
Since Covid-19, Durban’s recovery has been continuously disrupted. This has resulted in a decline in economic prospects for Durban. Durban has its unique challenges; in July of 2021, a widespread unrest occurred and recently, extensive flooding resulted in GVA loss of 1,6% (this figure is expected to increase with water rationing and prolonged infrastructure delays). In addition to these challenges are the inflationary pressures on commodities such as food, and fuel), and a hike in the prime interest rate that has increased the cost of living for all South Africans and further left Durban’s economy in a vulnerable state.
