Business
South Africa’s Economy Shows Quiet Strength with Another Quarter of Growth in 2025
A stronger quarter than anyone expected
South Africans have grown used to holding their breath when new GDP numbers come out. Yet the third quarter of 2025 arrived with a small but welcome sigh of relief. Stats SA confirmed that the country’s real GDP grew by 0.5 percent between July and September. It is the fourth quarter in a row that the economy has moved in the right direction, following an upward revision of second-quarter growth to 0.9 percent.
For a country that spent much of the year bracing for the impact of United States tariffs on local industries, this was not the outcome many expected. Economists had predicted a far tighter reading. Markets also questioned whether South Africa could hold steady after the US imposed thirty percent reciprocal tariffs from August. Yet the data has shown that the knock was softer than feared. Despite pressure on auto manufacturing, agriculture, and other export-heavy sectors, the broader economy held its ground.
Mining pulls ahead while other industries quietly recover
The biggest lift came from mining, which expanded by 2.3 percent. Platinum group metals led the charge. Manganese ore, coal, chromium ore and copper also pushed the industry into positive territory. Iron ore, diamonds, nickel, and gold dipped, yet not enough to weaken the overall momentum.
Agriculture added another solid performance. The sector posted its fourth consecutive increase with a 1.1 percent rise, supported by stronger production of field crops, horticulture, and animal products.
Trade, catering, and accommodation also kept climbing. From retail to restaurant activity, the country saw consistent gains across the board. Increased government employment helped lift general government services, while a rise in air transport, communication, and transport support services boosted the transport, storage, and communication category.
Even construction, a sector that has struggled for years, nudged into positive ground. Its 0.1 percent growth came mainly from activity in non-residential buildings and construction works.
The only major disappointment came from electricity, gas, and water, which shrank by 2.5 percent due to lower electricity production, lower usage, and muted water consumption.
South Africans keep spending and investment returns
Beyond production, demand told its own story. Household spending grew for the sixth quarter in a row, rising by 0.7 percent. New vehicle purchases were the biggest contributor, a sign that consumer confidence has not entirely disappeared. Clothing, footwear, and miscellaneous goods dipped, showing that people are becoming more selective about what they buy.
Perhaps the most encouraging shift came from investment. Gross fixed capital formation grew by 1.6 percent after three consecutive declines. Companies increased spending on transport equipment. There was also a notable rise in investment in ICT equipment and software.
Exports managed to grow by 0.7 percent despite the US tariffs. Vegetable products and mineral products were key drivers. Imports, meanwhile, rose by 2.2 percent due to higher trade in machinery, electrical equipment, mineral products, textiles, and various fats and oils.
A better outlook, although still not enough
Economists have slowly shifted their expectations for 2025. Many now see annual growth sitting somewhere between 1 and 1.2 percent. Even so, the year-to-date average sits at only 0.5 percent. That is not enough to hit the country’s full-year projections. Frank Blackmore from KPMG South Africa noted that even with an optimistic final quarter, overall growth is likely to fall below 1 percent for the year.
The bigger concern is long-term. South Africa needs growth of at least 3 percent to make a meaningful dent in unemployment and to turn the economic tide. The latest figures show progress, not victory. They offer proof that the country can stay steady even during global turbulence. They also remind us of the distance still left to travel.
Public reaction and the South African context
The national mood remains a mix of relief and realism. On social media, some South Africans celebrated the mining numbers and the resilience of exports, while others questioned how growth translates into daily living conditions. Many highlighted that although the economy expanded, households still feel the squeeze of rising costs, municipal failures, and uneven service delivery.
At the same time, analysts welcomed the data as another sign that the country is slowly regaining confidence. After years of instability in electricity supply, infrastructure challenges, and global shocks, four consecutive quarters of growth signal a quiet comeback. It is not dramatic or flashy. It is steady. And for many South Africans, steady is already an improvement.
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Source: Business Tech
Featured Image: Business Tech
