South African Economy In Recession

The South African economy has officially hit recession for the first time since the end of Apartheid in 1994.

The last time South Africa was in recession was in 1992.

Africa’s largest economy contracted 6.4% for the first three months of 2009. it’s biggest one-quarter decline since 1982. The previous three months, the South African economy contracted 1.8%.

A recession is defined as two consecutive quarters of declining growth.

“It’s far worse than we expected,” said Elna Moolman, economist at Barnard Jacobs Mellet. “It confirms the recession in the economy and certainly increases concerns about overall growth for 2009, given such a bad start for the year.”

A massive government spending program tied to the upcoming 2010 World Cup games has buffeted the South African economy from the worldwide recession.

The Reserve Bank of South Africa is expected to reduce interest rates by 1% today.

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