ECONOMY
South Africa’s gross domestic product (GDP) grew by 0,5% in the third quarter of 2025, moderating from the 0,9% expansion recorded in Q2. The data reflects a sluggishly improving economy supported by gains in trade, mining and household spending, despite continued weaknesses in utilities and a widening trade deficit.
Sector Performance: Broad-Based but Uneven Growth
Several major industries recorded positive growth in Q3.
The trade, catering and accommodation industry expanded by 1,0%, contributing 0,1 percentage points to GDP. Activity increased across wholesale, retail, motor trade, accommodation and the food and beverages sector—an indication of resilient consumer and tourism-linked demand.
The mining and quarrying industry grew by 2,3%, also adding 0,1 percentage points. Stronger production of platinum group metals, manganese ore and coal supported the sector’s recovery, despite global commodity volatility.
Services-related industries also strengthened.
Finance, real estate and business services expanded 0,3%,
General government services grew 0,7%, supported by higher public-sector employment,
Personal services increased 0,3%, and
Transport, storage and communication rose 0,5%, driven by air transport, transport support services and communication activities.
The manufacturing industry recorded modest growth of 0,3%, with four of ten divisions expanding. The food and beverages, and furniture and other manufacturing categories made the largest positive contributions.
Agriculture posted a solid 1,1% increase, supported by higher activity in field crops, horticulture and animal production.
In contrast, the electricity, gas and water industry contracted by 2,5%, subtracting 0,1 percentage points from GDP. Lower electricity production and consumption remain key structural constraints.
Demand-Side Trends: Household Spending Rebounds
On the expenditure side, household final consumption expenditure (HFCE) grew by 0,7%, contributing 0,5 percentage points to total GDP growth. Consumer spending rose across durable goods, non-durable goods and services.
The main contributors were:
Transport (+1,6%; +0,2 percentage points),
Food and non-alcoholic beverages (+0,9%; +0,1 pp),
Housing and utilities (+0,9%; +0,1 pp),
Furnishings and household equipment (+2,0%; +0,1 pp).
Expenditure on clothing, footwear and the “other” category declined.
Government consumption increased by 0,3%, reflecting higher compensation of employees.
Investment Strengthens but Trade Deteriorates
Gross fixed capital formation rose by 1,6%, contributing 0,2 percentage points to GDP. Strong momentum came from:
Transport equipment (+6,6%),
Other assets (+3,8%),
Transfer costs (+9,9%),
Non-residential buildings (+2,7%), and
Machinery and equipment (+0,4%).
Inventories increased by R25,7 billion, with major contributions from trade, manufacturing, and utilities.
However, net exports subtracted 0,4 percentage points from GDP. Exports grew 0,7%, driven by vegetable and mineral products, but imports rose 2,2%, reflecting higher demand for machinery, mineral products, textiles, and fats and oils.
Market Insyte offers personalised market research services tailored to entrepreneurs' needs.
If you would like to schedule a business model consultation, feel free to book a session here
If you would like us to conduct a personalised market research study, feel free to schedule a complimentary discovery call
Browse our public market research library