Skip to main content
Invest Now
012 012 5270
Copyright © Aluma Capital (Pty) Ltd. All rights reserved.
Aluma Capital (Pty) Ltd is a registered Financial Services Provider (FSP 46449) in terms of The Financial Advisory and Intermediary Services Act (37 of 2002)
Frederick Mitchell, Chief Economist | Aluma Capital (Pty) Ltd
Frederick Mitchell
March 10, 2026

South African Economic Performance – GDP, Economic growth and Inflation for 2025Q4

The South African economy grew by 0.4% in the fourth quarter of 2025, slightly below market expectations of 0.7%. This modest growth comes despite positive economic indicators, interest rate reductions, and improved confidence levels during this period. Remarkably, overall, electricity supply constraints did not impede performance in 2025.

Among the ten sectors, seven showed annual growth. Notably, the Agricultural sector increased by 19.9% during the last quarter of 2025, despite US tariffs on imports from South Africa, while the Manufacturing sector contracted by 0.6% during this period. The Finance and Wholesale & Retail sectors grew by 1.4% and 2.6%, respectively, during the fourth quarter of 2025, indicating that lower interest rates, coupled with lower inflation, were starting to work through the economy holistically.  

Overall, South Africa’s economic growth for 2025 is estimated at 1.1%, a notable increase from 0.5% revised growth for 2024, which remains inadequate to address the high unemployment crisis. However, with increased market optimism heading into 2026, even with trade tensions between South Africa and the US and ongoing conflict in the Middle East between the US and Iran, no load-shedding, a lower interest rate, and an inflation rate of 3.5% and a target of 3.0% by the SARB, there is potential for improved economic activity going forward in 2026.

Challenges persist for businesses, and it is crucial for the government to deliver policy clarity and concrete progress on previously announced structural reforms. These structural reforms, coupled with Government infrastructure investment in the February 2026 budget, might just be the spark the South African economy needs for continued growth in 2026. It should however be mentioned that the extension of the AGOA agreement for only 2026 and a possible expulsion of South Africa from this agreement will most likely still threaten South African businesses exporting to the U.S. Addressing these critical issues is essential to boost business confidence further for the year, which is necessary for driving significant economic growth in the coming months—a need that South Africa cannot overlook at this stage.

Back to News

More Coverage

Mining Production and Sales for March 2026

In March 2026, South Africa’s mining sector showed promising growth, with activity up 2.5%, driven primarily by substantial increases in platinum group metals (PGM) and gold production. This article delves into the remarkable statistics, including a staggering 113.5% surge in platinum sales and a robust 30.2% increase in nominal mining sales, highlighting the industry’s crucial role in generating employment and foreign exchange for the economy. However, amid positive growth trends, the sector faces significant challenges, including geopolitical tensions, tariff measures, and the potential impacts of a changing global market. Discover how these dynamics affect one of the country’s key economic contributors and the overall outlook for the mining industry as South Africa navigates through a complex landscape of opportunities and hurdles. Read on for an in-depth analysis of the mining sector’s performance and its implications for South Africa’s economic future.

anufacturing Production – March 2026

Discover the surprising resilience of South Africa’s manufacturing sector in March 2026, where a remarkable 0.9% increase defied analysts’ expectations following a 2.3% slump in February. This unexpected growth, propelled by expansion in key sectors like food and beverages, petroleum, and electrical machinery, suggests a positive shift in business sentiment. Despite a quarterly downturn, manufacturing sales edged upward, signalling underlying strength amidst international trade tensions and tariffs. Uncover how South Africa’s industry navigates these choppy waters by maintaining robust cash reserves, hinting at strategic adaptations to the evolving economic landscape. Dive into this comprehensive analysis to understand the delicate interplay of growth factors and challenges shaping the future of South Africa’s manufacturing sector.

Employment Statistics in South Africa: 2026Q1

Delve into the latest employment statistics for the first quarter of 2026, revealing a challenging landscape for South Africa, with a rise in the unemployment rate to 32.7%, surpassing expectations. The report uncovers sectoral job losses, contrasting with a modest uptick in the manufacturing sector. Despite a marginal increase in total employment, the broader economic picture is overshadowed by an expanding unemployment pool of 8.1 million individuals. Explore regional employment trends, with KwaZulu-Natal as a rare positive outlier, against the backdrop of global economic uncertainties like US-China tariffs and Middle Eastern conflicts, shaping South Africa’s job market in the coming months.

Phalanomics:  Accountability vs. Stability while navigating South Africa’s New Political Crosswinds

South Africa’s Constitutional Court has reopened the Phala Phala impeachment process, creating renewed political uncertainty around President Cyril Ramaphosa and the GNU. While markets remain stable for now, concerns include weaker investor confidence, delayed reforms, and pressure on the Rand if political tensions escalate. At the same time, the ruling reinforces the strength of South Africa’s democratic institutions, showing that the Constitution and judiciary remain strong checks on political power.

The Velocity of Resilience: Why Speed is South Africa’s Newest Economic Buffer

Discover how South Africa is turning speed into a formidable economic shield against rising challenges such as fuel price hikes and cost-push inflation. Explore how the nation is battling “economic friction” by leveraging cutting-edge local fintech solutions, like PayShap, and groundbreaking international developments in blockchain technology to create a “velocity buffer.” This strategy empowers small businesses and larger firms alike to maintain agility and financial resilience through instant financial transactions. Witness the transformative impact of reducing exposure to currency volatility and unlocking 24/7 market access, as South Africa aims for a “T-Zero” economy where speed transforms into a strategic hedge against inflation, ensuring economic stability and growth even in tumultuous times.