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A Silver Lining for the South African Economy

South Africa’s economy is 11% bigger than previously estimated, after statistics authorities changed the way they calculate gross domestic product. GDP at current prices measured $369 billion in 2020, compared with a previous estimate of 4.97 trillion rand, said Joe de Beer, deputy director-general of economic data at Statistics South Africa, told reporters Wednesday in the capital, Pretoria. The economy remains Africa’s second biggest, lagging behind Nigeria. The upward revision means some key fiscal metrics, including the ratio of debt as a percentage of GDP, may now look better, De Beer said in an interview. Ratios in which GDP is the denominator will decline if the numerator remains the same, he said. The statistics office altered its methodology for calculating the data by changing the reference year to 2015 from 2010, included new sources of information and refined its classification of activities to better reflect the structure of the economy. The contribution of personal services to economic output more than tripled as a result of the changes, while that of the finance, real estate and business services industry is now 26% greater. General government’s contribution decreased by 45%.