The South African economy has been experiencing lots of falls following the inconsistencies of the rand and other global commodities. Recent data report from Statistics SA, explained that SA’s mining production experienced a sharp drop in output of platinum group metals (PGMs).
Statistic SA’s data reports that mining production fell from 8.3% recorded in February to 18% in March indicating a very worrying acceleration of the fall in production especially as global commodity prices continued to be lowered and the demand from countries like China continues to slow down.
“It was the sharpest decrease on record as copper production declined the most by 38.3 percent, followed by other metallic minerals (-27.5 percent), manganese ore (-24.3 percent), platinum-group minerals (-23.7 percent) and iron ore (-21.4 percent).”
“Diamond output fell 18 percent and gold production dropped by 7.4 percent,” it says.
The main contributors to the decline in mining output were PGMs, coal, iron ore, manganese ore, and gold.
In addition, the mining output decreased by 3.4 percent on monthly basis as compared to an upwardly revised 2.1 percent growth in February.
Considering the first quarter, the data also revealed that mining shrank 5.2 percent from the previous period. Mining Production in South Africa averaged -0.08 percent from 1981 until 2016, reaching an all time high of 24.30 percent in October of 2013 and a record low of -18 percent in March of 2016.
However, Mineral sales, increased by 1.6% year on year in February. The biggest positive contributor was gold. The increase in mineral sales was offset by lower iron ore sales.
This report came a while after the data report showing a 26.7% sharp rise of unemployment in the state. This percentage is interpreted to mean that about 5.714 million people are without jobs in the first quarter compared with 5.2 million previously.
However, the cabinet said on Thursday it was taking measures to deal with the high unemployment rate, which spiked to a record in the first quarter in a country where economic growth has stagnated.
“Cabinet has taken a decision to draft a plan to develop least developed parts of the country in an attempt to stimulate the economy, especially among the uneducated youth,” cabinet minister Gugile Nkwinti told a media briefing.
Explaining further on part of the measure to be taken by the government, Nkwinti said the government would focus more on technical education for youth in the country to improve employment.
Moody’s late on Friday left its rating of South Africa debt unchanged, but the other big ratings agencies are expected to release their own reviews in the coming weeks.