This data story explores the economic fluctuations experienced by Durban from late 2020 through the first quarter of 2024 (2024Q1). It delves into the city's quarterly GDP growth rates, highlighting periods of both expansion and contraction. The analysis also compares Durban's performance with other major metros, examining sector-specific growth and declines. Additionally, it provides future growth forecasts, offering insights into the economic outlook for Durban and its position relative to other major metros.
In 2024Q1, both Durban and South Africa faced economic setbacks. Durban experienced a negative growth rate of 0.2%, aligning with the national economic decline of 0.1%,following a 0.3% increase in the previous quarter. Durban’s GDP growth has exhibited significant fluctuations from late 2020 through to the first quarter of 2024.
After a strong recovery post-COVID-19 with a 2.9% growth rate in 2020Q4, the city experienced varying periods of growth and contraction. Notably, 2021 saw a significant drop to -1.6% in Q3, followed by recovery in subsequent quarters. The trend continued into 2022 with positive growth in the first half of the year but declined in the latter half. In 2023, the growth remained modest but turned negative in Q3 and maintained this trend into the first quarter of 2024.
In 2024Q1, Durban's GDP declined by 0.2%, compared to a 0.6% growth in the same period last year. During this period, four major sectors saw growth: finance (2.49%), electricity(2.26%), community services (1.85%), and transport (1.06%). Conversely, five sectors faced negative growth: agriculture (-9.28%), construction (-8.16%),trade (-3.9%), mining (-3.02%), and manufacturing (-0.59%).
Since 2021, the major cities experienced positive GDP growth as a rebound from the massive slump during the COVID-19 pandemic. In 2022, growth remained positive across all cities but moderated compared to the previous year, with Durban showing slower growth.
In 2024Q1, Durban's GDP growth shifted from 0.2% to -0.2% quarter-on-quarter, indicating a negative turn in economic activity. Other metros followed this pattern: Cape Town's GDP fell from 0.4% to -0.2%, Johannesburg from 0.5% to -0.1%, Ekurhuleni from 0.3%to 0.0%, and Tshwane from 0.3% to -0.3%. Despite this contraction in Durban’s GDP, S&P Global Market Intelligence forecasts the city’s economy to grow by1.0% in 2024, Johannesburg (1.7%), and Cape Town and Ekurhuleni (both at 1.6%).
Year-on-year, Durban's GDP contracted by 0.2%, a significant drop from 0.6% growth in 2023Q1.Similarly, Cape Town's GDP fell from 0.7% growth to -0.2%, Johannesburg from0.8% to -0.1%, Ekurhuleni from 0.3% to 0.0%, and Tshwane from 0.4% to -0.3%.These trends highlight a widespread economic slowdown across all major metros over the past year.
Durban's GDP growth has experienced significant fluctuations from late2020 through to 2024Q1. After a strong post-COVID-19 recovery, the city went through various periods of growth and contraction, with notable declines in recent years. By early 2024, Durban's GDP had declined compared to the same period the previous year, reflecting a broader trend of economic contraction seen across other major metros.
Despite these challenges, there is an optimistic forecast for Durban's growth in 2024, supported by uninterrupted electricity supply since March 26,2024, and continued attraction of foreign direct investment from Africa. To enhance its economic growth, Durban must compete with other major cities to secure a significant share of this investment.
The city is actively pursuing various medium-to-long-term initiatives to stimulate growth, guided by the Durban Catalytic Projects Infrastructure Plan and other sector-specific strategies. These initiatives focus on regeneration and spatial transformation, aiming to diversify the economy, enhance proximity to employment and economic opportunities, reduce travel distances and costs, and ensure equitable access to land, housing, infrastructure, and government services.
Currently, large-scale spatial transformation projects in the Durban region, with an investment value exceeding R70 billion, are underway. These projects, include developments in Avoca, Cornubia, Dube Trade Port, Midway Crossing, the Point Waterfront, Shongweni (Westown), Keystone Park Logistics Precinct, Whetstone Business Park, Automotive Supplier Park, Centum Precinct, Cato Ridge Logistics Hub, and the redevelopment of the Virginia Airport site, all of which are set to create significant opportunities for investors, generate employment, and stimulate local economic growth.
1. S&P Global Regional eXplorer (ReX); 2024: http://www.ihsmarkit.co.za/Products/ReX/
2. Statistics South Africa. (2024). Gross domestic product survey. Available at: https://www.statssa.gov.za/publications
3. https://www.thecitizen.co.tz/tanzania/magazines/the-10-african-countries-that-attracted-the-most-fdi-in-2023-4671394
