Loaded for Bear: SA’s GDP and fiscal numbers get a lift from zama zamas

Detailed summary

GDP is the sum of all the goods and services produced in a country over a specific timeframe, and the bottom line is that those linked to zama zamas and other ‘informal’ economic…

GDP is the sum of all the goods and services produced in a country over a specific timeframe, and the bottom line is that those linked to zama zamas and other ‘informal’ economic actors have now been subjected to heightened scrutiny to derive a more accurate estimate.

South Africa’s Treasury once again has reason to be grateful to the mining industry, but this time round it’s the zama zamas who deserve a round of applause.

To wit, South Africa’s gross domestic product (GDP) has just undergone a twice-a-decade rebasing, in line with standard international practice, shifting the base year to 2022 from 2015.

Also referred to as the reference year, this is done to calculate GDP in constant currency terms and capture the changing structure of the economy.

This is not a case of smoke and mirrors. Indeed, it is a case of smoking out uncounted activities to better reflect the size of the economy.

And lo and behold, one economic activity that had been literally underground for years has been brought into the light of the GDP data.

“The 2026 benchmarking and rebasing raised the level of the economy in 2022 to R6.99-trillion, up by 4.9% from the previously published R6.667-trillion,” said Statistics South Africa (Stats SA).

The term of art on this front is “non-observed economy” or NOE, which Stats SA said accounts for 8.7% of the economy.

“After the pandemic, the NOE increased significantly. Compared with previous estimates, the revised estimates show a larger contribution of the NOE to the economy,” Stats SA said.

Opening of the article, excerpted from Daily Maverick. To read the rest, open the article on the publisher's site.