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Economic Performance Indicators for Cape Town (EPIC)

Economic Indicators - [http://images.clipartpanda.com/economy-clipart-l_078.png] Economic Indicators - [http://images.clipartpanda.com/economy-clipart-l_078.png]

Key Highlights of the Economic Performance Indicators for Cape Town (EPIC) for the 1st Quarter 2016

 

•  While GDP growth remained stable for most developed economies, Germany experienced a notable decline from the fourth quarter of 2015 whereas in emerging economies, growth trends were diverse with high growth in India and China, yet the continuance of recessionary growth trends in Russia and Brazil.

•  Crude oil prices were almost 40% lower in January 2016 than they were a year ago, having knock-on effects in the prices of a range of commodities, including food. Food price inflation in the Western Cape was 9,1% in March 2016, lower than the national rate of 10,9%.

•  The South African rand depreciated sharply against the developed-economy currencies reaching a record low in January 2016, but appreciated in the remainder of the quarter supported by the moderation in the United States’ normalisation path and improved retail sales domestically (up 4,1% year on year) in February 2016.

•  The slower than expected growth of the South African economy in the first quarter pushed year-on-year growth 2,9% points lower than what was recorded for the first quarter of 2015 and the lowest it has been since the recession in 2009. This weak performance was driven by a substantial contraction in the primary sector.

•  The Western Cape was one of only two provinces which observed positive growth in the first quarter. The main sources of growth in the Western Cape and Cape Town were the wholesale and retail trade, and finance and business services sectors.

•  Cape Town was one of only two metros to experience an increase in employment during the first quarter of 2016. The number of people employed in Cape Town increased by 4 000 individuals on a quarterly basis and by almost 92 000 individuals on a year-on-year basis. From a static point of view, Cape Town also had the lowest expanded unemployment rate (21,7%). It also observed a decrease in the number of discouraged work-seekers from 9 406 in the fourth quarter of 2015 to 4 582 in the first quarter of 2016.

•  Cape Town’s exports grew in nominal rand terms from R73,7bn in 2014 to R79,3bn in 2015. Imports declined by R25,7bn in 2015, although this was due to a large decline in the import value of crude petroleum - attributed to the lower oil prices experienced globally.

•  The clothing and textiles industry continues to be a major employer in the Cape Town economy and is the second largest employer within the manufacturing sector. Despite job losses being recorded every year between 2004 and 2014, the rate at which jobs have been shed has slowly been decreasing, from over 10% per year in 2005 and 2006, to just 1,1% in 2014. Recent figures from the IDC suggest that the sector recorded positive job growth in 2015.

•  The seeming revival of the clothing and textile industry can be attributed in part to the work of cluster initiatives in helping clothing and textile manufacturers adapt their production systems to a quick response model that gives them a competitive advantage over long-haul suppliers. The high concentration of retail head offices in Cape Town underpins the ability of local retailers and manufacturers to coordinate their activities to ensure the quickest possible response to changes in customers’ tastes and preferences, putting them at a distinct advantage over manufacturers in other locations.

•  Tourist accommodation in Cape Town performed well in the first quarter of 2016 compared to the first quarter of 2015 as all three accommodation performance indicators (occupation rate, average room rate and revenue per room) reported positive growth rates. Total passenger movements at Cape Town International in the first quarter of 2016 were higher compared to the first quarter of 2015, yielding a 10,12% increase in visits to major tourist destinations compared to the corresponding period in 2015. This can be credited to the popularity of events such as the Design Indaba, Cycle Tour, Two Oceans Marathon and the Cape Town Carnival which continue welcoming a growing number of visitors every year.

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