The GDP numbers were out this week and are every bit as bad as you would have expected, and perhaps worse. “The punch in the gut was severe” begins the press release from the otherwise more sanguine sages at StatsSA, who went on to give us the numbers: GDP down -16% from the first to the second quarter of this terrible year, with an annualised quarter-on-quarter decline of -51%, a number we had to look at twice to make sure we weren’t mistaken while questioning the reason for annualising. To put it in context, the annualised slowdown during the first quarter of 2009 when the financial crisis hit was -6.1%. Looking into StatsSA’s reported annualised quarter-on-quarter numbers, construction was hardest hit as a sector, down -76.6% after seven straight quarters of losses, and manufacturing was just about as bad at -74.9%. Trade declined -67.6%, and household spending for the period was down -49.8%, with spending on hotels and restaurants alone declining -99.9%, and spending on tobacco and alcohol down -92.4%.
Comment: What have we learnt from all of this? Right now, we don’t know. But if and when recovery comes, we should spend some time and capital on futureproofing our economy against further inevitable shocks.