National Accounts – September 2008 Issue

Highlights

YEAR 2007
GDP growth rate

1. GDP growth rate for 2007 is maintained at 5.4% as estimated in June 2008. Exclusive of sugar, the growth rate worked out to 6.1% same as the estimate made earlier.

YEAR 2008
GDP growth rate

2. On the basis of latest information gathered on various sectors of the economy and recent past trends, the economy is expected to grow by around 5.6% in 2008, slightly lower than the forecast of 5.7% made in June 2008. Exclusive of sugar, the growth rate would be around 5.6% compared to the previous forecast of 5.8%.

3. The main assumptions now used for the forecast are:

(i) Sugarcane/sugar milling: a production of 460,000 tonnes of sugar compared to 435,972 tonnes in 2007. This would result in a growth of 5.5% compared to -13.6% in 2007.

(ii) Manufacturing industries: to grow by 3.1% compared to 2.2% in 2007. The higher growth would be the result of a higher sugar production, 2.6% growth in Food, 2.8% in Textiles, together with a rebound of 3.5% in other manufacturing.
Within the manufacturing sector, the EOE is expected to grow 6.0% compared to 8.0% in 2007. It is to be noted that textile manufacturing export enterprises are expected to grow by 3.2% and other EOE manufacturing by 15.0%, compared to 9.0% and 4.9% respectively in 2007.

(iii) Construction: to grow by around 11.0% compared to 15.2% in 2007, mainly attributable to the construction of commercial and office buildings, hotels and projects under the Integrated Resort Scheme.

(iv) Hotels and restaurants: to expand by 5.6%, lower than the growth of 14.0% registered in 2007. The consequence of unfavourable economic situation in our main tourists generating countries and increase in air fares. Tourist arrivals are expected to be around 960,000 compared to 906,971 in 2007 and tourist receipts of around R 44,338 million compared to R 40,687 million.

(v) Wholesale and retail trade: to grow at the rate of 4.7%, higher than the 2007 figure of 4.4%.

(vi) Financial intermediation: to grow by 7.8%, slightly higher than the growth of 7.5% registered in 2007.

Consumption and Saving
4. Final consumption expenditure of households and Government will most likely grow by 4.1% in 2008, higher than the 3.9% growth in 2007. The final consumption expenditure of households would grow by 4.9% and that of general government by 0.5% compared to 4.5% and 0.8% respectively in 2007. Saving rate defined as the ratio of GNS to GDP at market prices, will most likely decrease to 19.6% from 21.3% in 2007.

Investment
5. Investment in 2008 is forecasted to grow by 6.5% compared to 8.6% in 2007. Exclusive of investment on aircraft and marine vessel, the growth rate works out to 10.2% compared to 17.0% in 2007.

6. Investment rate would reach 25.4% in 2008 higher than the figure of 25.1% attained in 2007. Exclusive of investment on aircraft and marine vessel, the rate would be 25.2%, higher than the figure of 24.1% in 2007.

7. Private sector investment is expected to grow by around 11.3% after a high growth of 24.0% in 2007, mostly attributable to high investment in commercial and office buildings, hotels, and IRS projects. Public sector investment is expected to decline further by around 11.0% after a decline of 24.7% in 2007. Excluding the acquisition and sale of aircraft, public sector investment would grow by 10.5% after a contraction of 7.4% in 2007, mainly attributable to high government expenditure on sewerage and roads projects.

8. Private sector investment as a percentage of GDP at market prices will most likely increase to 20.8 in 2008 from 19.6 in 2007 and that of the public sector will decline to 4.6 from 5.5 in 2007.

9. The share of private sector investment will most likely increase to 81.8% from 78.2% in 2007 and that of the public sector will decline to 18.2% from 21.8%.

September 2008

More: National Accounts – September 2008 Issue

Introduction

Table 1 Main National Accounts aggregates, 2005 – 2008

Table 2 Growth rates and ratios, 2005 – 2008

Table 3 Gross Domestic Product by industry group at current basic prices, 2005 – 2008

Table 4 Value added by industry group at current basic prices for General Government, 2005 – 2008

Table 5 Percentage Distribution of Gross Domestic Product by industry group at current basic prices, 2005 – 2008

Table 6 Gross Domestic Product - sectoral real growth rates (% over previous year), 2005 – 2008

Table 7 Contribution of industry groups to GDP growth, 2005 – 2008

Table 8 Gross Domestic Product - sectoral deflators (% over previous year), 2005 – 2008

Table 9 Expenditure on Gross Domestic Product at current prices, 2005 – 2008

Table 10 Expenditure on GDP - Growth rates (% over previous year), 2005 – 2008

Table 11 National Disposable Income and its appropriation at current prices, 2005 – 2008

Table 12 Gross Domestic Fixed Capital Formation at current prices by type and use, 2005 – 2008

Table 13 Gross Domestic Fixed Capital Formation - Annual real growth rates (%) by type and use, 2005 – 2008

Table 14 Gross Domestic Fixed Capital Formation - Deflators (% over previous year), 2005 – 2008

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