South Africa’s economy contracted by 0.2% in the second quarter of 2026, a sharp reversal from the 0.4% growth recorded during the first quarter.
The figures were released by Statistics South Africa (Stats SA) on Tuesday.
The contraction was largely driven by declines in the trade, catering and accommodation sector, which fell by 1.9% and shaved 0.2 of a percentage point off GDP growth.
Stats SA said lower activity was recorded in wholesale and motor trade, as well as food and beverage services.
Manufacturing also declined, falling by 1.8% and contributing a negative 0.2 of a percentage point. Seven of the sector’s 10 divisions recorded negative growth.
The biggest declines were recorded in food and beverages, furniture and other manufacturing, as well as basic iron and steel, non-ferrous metals, metal products and machinery.
Mining and quarrying contracted by 3.0%, reducing GDP growth by a further 0.1 of a percentage point. The main contributors to the decline were platinum group metals, manganese ore, gold and iron ore.
Some sectors recorded modest growth during the quarter.
Finance, real estate and business services increased by 0.3%, adding 0.1 of a percentage point to GDP. Financial intermediation, insurance and pension funding, and other business services were among the main contributors.
Transport, storage and communication grew by 0.9%, also adding 0.1 of a percentage point, with land transport recording increased activity.
General government services rose by 1.0%, contributing another 0.1 of a percentage point, largely due to higher employee compensation at extra-budgetary and higher education institutions, as well as provincial government.
Personal services increased by 0.6%, supported by stronger activity in community services and other producers.
Household spending also edged higher, with household final consumption expenditure increasing by 0.4%. Stats SA said this contributed 0.3 of a percentage point to overall GDP growth.
Spending on food and non-alcoholic beverages rose by 1.2%, while expenditure on other goods and services increased by 0.6%. Recreation and culture rose by 0.8%, while health spending increased by 0.7%.
These gains were partly offset by lower household spending on housing, water, electricity, gas and other fuels, as well as transport, communication, clothing and footwear.
The figures were released by Statistics South Africa (Stats SA) on Tuesday.
The contraction was largely driven by declines in the trade, catering and accommodation sector, which fell by 1.9% and shaved 0.2 of a percentage point off GDP growth.
Stats SA said lower activity was recorded in wholesale and motor trade, as well as food and beverage services.
Manufacturing also declined, falling by 1.8% and contributing a negative 0.2 of a percentage point. Seven of the sector’s 10 divisions recorded negative growth.
The biggest declines were recorded in food and beverages, furniture and other manufacturing, as well as basic iron and steel, non-ferrous metals, metal products and machinery.
Mining and quarrying contracted by 3.0%, reducing GDP growth by a further 0.1 of a percentage point. The main contributors to the decline were platinum group metals, manganese ore, gold and iron ore.
Some sectors recorded modest growth during the quarter.
Finance, real estate and business services increased by 0.3%, adding 0.1 of a percentage point to GDP. Financial intermediation, insurance and pension funding, and other business services were among the main contributors.
Transport, storage and communication grew by 0.9%, also adding 0.1 of a percentage point, with land transport recording increased activity.
General government services rose by 1.0%, contributing another 0.1 of a percentage point, largely due to higher employee compensation at extra-budgetary and higher education institutions, as well as provincial government.
Personal services increased by 0.6%, supported by stronger activity in community services and other producers.
Household spending also edged higher, with household final consumption expenditure increasing by 0.4%. Stats SA said this contributed 0.3 of a percentage point to overall GDP growth.
Spending on food and non-alcoholic beverages rose by 1.2%, while expenditure on other goods and services increased by 0.6%. Recreation and culture rose by 0.8%, while health spending increased by 0.7%.
These gains were partly offset by lower household spending on housing, water, electricity, gas and other fuels, as well as transport, communication, clothing and footwear.
