South Africa’s economy is 11% larger than previously estimated after statistical authorities changed the way they calculate gross domestic product.
GDP at current prices measured 5.52 trillion rand ($ 369 billion) in 2020, compared to a previous estimate of 4.97 trillion rand, said Joe de Beer, deputy general manager for economic data at Statistics South Africa, to journalists on Wednesday in the capital, Pretoria. . The economy remains the second largest in Africa, behind Nigeria.
The upward revision means that some key fiscal metrics, including debt ratio as a percentage of GDP, can now be seen better, De Beer said in an interview. The ratios that GDP is the denominator will decrease if the numerator stays the same, he said.
The revision means that debt as a proportion of GDP will remain below 80% until 2023-24, Annabel Bishop, chief economist at Investec Bank Ltd said in a note. The government projected in February that the ratio would exceed the 80% mark in the year to February 2021 and reach 87.3% in fiscal 2024. The budget deficit for the current fiscal year is now considered at 8.4 % of GDP, compared to the National Treasury’s estimate of 9.3%, Bishop said.
The statistical office modified its methodology for calculating the data by changing the reference year to 2015 from 2010, included new sources of information and refined its cla**ification of activities to better reflect the structure of the economy.
The contribution of personal services to economic output more than tripled as a result of the changes, while that of the financial, real estate and business services industry is now 26% higher. The general government contribution decreased by 45%.
Household consumption as a percentage of GDP is estimated to be 16% higher in base year 2015 and GDP per capita is now revised to R79,913, up from a previous estimate of R73,209.
The size of Nigeria’s economy was $ 375 billion in 2020. Its statistics office plans to release revised GDP data in late 2022 or the first quarter of 2023.