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Frederick Mitchell, Chief Economist | Aluma Capital (Pty) Ltd
Frederick Mitchell
June 11, 2025

Manufacturing Production

April 2025

In April 2025, South Africa’s manufacturing output declined by 6.3%, following a 1.2% decrease in March—exceeding most analyst forecasts of a 2.8% contraction for April. The Purchasing Managers’ Index (PMI) fell from 48.7 in March to 44.7 in April, reflecting growing manufacturer apprehension.

Key contributing factors include:

  • Petroleum, Chemical, Rubber, and Plastic Products: -4.7%, reducing overall output by 1.0 percentage point.
  • Motor Vehicles and Transport Equipment: -13.0%, adding 1.2 points to the decline.
  • Food and Beverages: -7.6%, decreasing output by 1.8 points.
  • Iron, Steel, Metals, and Machinery: -6.3%, contributing 1.4 points to the contraction.

Seasonally adjusted sales dipped by 0.7% in April, and the rolling quarter ending in April contracted by 0.3% compared to the previous quarter. Declines were driven primarily by Basic Iron and Steel, Metals, and Machinery, which fell by 3.3%, while Motor Vehicles and Parts expanded by 6.5%, offsetting sector declines.

Manufacturing remains vital to South Africa’s economy, employing about 1.6 million people and contributing 12.5% to GDP in 2024. Employment increased slightly from 1.675 million in Q4 2024 to 1.677 million in Q1 2025, indicating a cautiously optimistic outlook despite April’s contraction.

However, sector sentiment remains cautious, with many business owners adopting a “wait-and-see” approach due to concerns over US tariffs impacting exports and ongoing US-China trade tensions. Despite current international uncertainties, companies continue to hold significant cash reserves, reflecting a cautious stance amid domestic and global economic complexities.

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South Africa is trapped in severe economic stagnation, facing a projected 1.0% growth rate for 2026, 33.6% unemployment, and sharp contractions in mining (-12.7%) and manufacturing (-4.3%). Exposed to global fuel shocks via depleted reserves and >R12.00/litre pump levies, the nation is also caught in a fiscal spiral where national debt nears 80% of GDP and interest payments exceed R1 billion daily. Escaping this trap requires four urgent structural reforms: halting interest rate hikes for supply-side inflation, replacing rigid B-BBEE quotas with job-creation incentives, scrapping Expropriation Without Compensation (EWC), and deregulating Transnet’s logistics corridors.

Mining Production and Sales for August 2026

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MACROECONOMIC & INVESTMENT INSIGHTS | OCTOBER 2026

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International Trade and Trade Balance – August 2026

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Private Sector Credit Extension (PSCE): August 2026

South Africa’s credit market is showing surprising resilience, with credit demand rising by 7.5% in August 2026 despite renewed interest-rate pressure, elevated inflation and mounting household costs. While mortgage advances continued to grow, the fragile recovery in the property market highlights the strain caused by subdued investment, high debt levels and rising municipal and energy expenses. At the same time, sluggish instalment credit growth and continued reliance on short-term borrowing reveal how consumers are navigating increasingly difficult financial conditions. With higher oil prices, geopolitical risks and further SARB tightening adding to the pressure, this report examines what the latest credit trends reveal about household finances, business confidence and the broader South African economy.