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South Africa Falls into Recession


New data confirms that South Africa's economy, the largest in Africa, has slipped into a recession for the first time since 1992.

The government said Tuesday that the country's gross domestic product shrank 6.4 percent in the first quarter of this year.

It was the second straight quarter of decline for South Africa's GDP, which shrank 1.8 percent in the last quarter of 2008.

Demand for South African exports has dropped, and this was reflected in data showing slumps in the country's mining and manufacturing sectors.

The findings will likely lead to pressure on South Africa's central bank to further cut interest rates.

The first-quarter decline was much larger than most economists had expected. Polls of economists conducted last week forecast a drop of 3.9 percent.

Correspondent Scott Bobb, in Johannesburg, is following the story. Hear his conversation with Joe De Capua about the South African economy by clicking audio link in right column.




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