South Africa’s manufacturing output declines 1.7% in June

South Africa’s manufacturing output fell 1.7% year-on-year in June, extending a decline that began in May, official data showed on Tuesday.

The drop, reported by Statistics South Africa, reflects persistent challenges in the sector, including unreliable electricity supply and subdued consumer demand. Manufacturing, which accounts for about 13% of the country’s gross domestic product, has struggled to recover from the lingering effects of power outages and logistics bottlenecks.

On a monthly basis, seasonally adjusted output rose 0.2% from May, a marginal improvement that suggests some stabilization in production levels. However, the year-on-year decline underscores ongoing weaknesses in key industries such as metals, machinery and food processing.

Analysts noted that while energy supply has improved compared with 2023, structural issues—including high borrowing costs and weak business confidence—continue to hinder a broader recovery. The central bank’s restrictive monetary policy, aimed at curbing inflation, has further dampened investment in the sector.

The latest figures add to concerns about South Africa’s economic growth prospects, with GDP growth expected to remain sluggish in the second half of the year. The manufacturing sector’s performance has been closely watched as a barometer of broader industrial activity and job creation potential.