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Southern Africa Quarterly Overview and Analysis - Second Quarter 2012 - Issue 5
Economic activity in Southern Africa was subdued during the second quarter of 2012, though progress remained on course for the region to attain an end-of-year real gross domestic product (GDP) growth rate of 4.0 percent. Lackluster performance in South Africa adversely affected other countries, particularly Lesotho and Swaziland, and was significant in the region’s sluggish growth. South Africa continued to suffer from a contraction of its primary sector, with mining output declining as domestic supply constraints and weaker global demand took their toll.
Swaziland and Lesotho had growth rates revised downward due to the problems in South Africa, although in Lesotho, the lingering effects of the 2011 drought continued to have an adverse impact. Nonetheless, the outlook for Lesotho remains bullish, with the commencement of the large diamond mining expansion and strong demand from Asia and China for the small country’s jewelry.