South African Economy Suffers Worst Slump In a Decade

South Africa’s economy has suffered its most severe quarterly slump in a decade, ratcheting up the pressure on President Cyril Ramaphosa to revive the continent’s most industrialised country, the Financial Times reported. Severe power shortages caused by the crisis at Eskom, the struggling state power utility, dragged economic output 3.2 per cent lower in the first quarter on an annualised basis, according to Treasury data released on Tuesday. The bigger-than-expected drop was the largest quarterly fall since the depths of the global financial crisis in 2009. Activity in power-intensive mining and manufacturing fell sharply as Eskom, which generates nearly all of South Africa’s electricity, imposed its deepest power cuts in February and March. “This is worse than anyone expected, and things went wrong in several sectors,” said John Ashbourne, senior emerging markets economist at Capital Economics. Read more