GDP stands for Gross Domestic Product and it measures output and income for a country’s economy. Gross domestic Product is equals to total expenditure for all final goods and services produced in a country within a stipulated period of time. South Africa’s GDP is measured by production and expenditure. There are two methods to measure the GDP of a country namely the production method and the expenditure method. The production method measures the total value of all good and services produced. The expenditure method measures total spending that has taken place in the economy.
The national treasury revised down South Africa’s GDP to 1.5% in the first quarter of 2019. This has been a result of slow improvement in production and unemployment. The drop in the GDP has also been a result of weaker investment outcomes in 2018. The current GDP for South Africa stands at $385.526 billion. The world bank reckons the lack of certainty when it comes to policy as a contributing factor to the huge drop in the South African GDP. Economist forecast that the GDP of South Africa will rise to $390.00 billion by the end of this quarter. This positive forecast can cultivate a positive investor confidence and improve the economy. Agriculture, mining and manufacturing are the biggest contributors to South Africa’s GDP. The widespread corruption in State owned companies such as Eskom and many other have contributed severely to South African’s GDP. This has resulted in the drop in investor confidence and increase in inflation and unemployedaround South Africans. Most businesses have suffered immensely as a result of poor trade relationships with other countries.