South Africa’s economy is about to be measured against a new yardstick. Statistics South Africa’s second-quarter GDP release says the agency, working with the Reserve Bank, “is in the process of changing the base year for national accounts estimates to 2022” and that the rebased and benchmarked estimates are expected in October 2026. Business Day’s economic week ahead places that release on Thursday 29 October, alongside restated provincial GDP estimates and September producer price inflation.
Most readers will see a headline about a bigger economy. The more useful question for a business is which ratios and sector shares quietly change with it.
What Stats SA has confirmed
The facts on the record are narrow. In its 8 September release on the second quarter, Stats SA reported that GDP decreased by 0.2% after growth of 0.4% in the first quarter, and added a short note that the base year is moving to 2022 and “further details” would follow closer to publication. It did not give a date in that note, did not say how large the revision would be and did not name which years would be restated.
Business Day, quoting the agency, says the five-yearly exercise is meant “to ensure that the GDP measurement remains reflective of the South African economy and relevant amid structural changes over time”. It describes rebasing as changing the reference year for constant-price estimates, and benchmarking as improving data, classifications and methods so that structural changes in the economy are captured.
The 2021 precedent shows the scale of change
The last exercise, published on 25 August 2021, is the best guide to what can move. According to the Reserve Bank’s note on that revision, nominal GDP for 2020 was lifted by 11%, and the revised level was higher by 9.6% on average between 2011 and 2020. Nominal GDP for 2020 went from R4,973 billion to R5,521 billion, a difference of R548 billion, which BusinessTech reported at the time.
Real growth barely changed. The Reserve Bank said the average growth rate between 2010 and 2020 moved from 0.6% to 0.7%, and the 2020 contraction was revised from 7.0% to 6.4%. The economy was not suddenly growing faster. It was being counted more completely.
The composition changed more than the headline. According to BusinessTech’s report at the time, many services that had been counted as general government were moved into personal services, and Investec’s note put the finance, real estate and business services sector at about 26% larger than before. Services were simply being captured more completely.
Why ratios matter more than the rand figure
A larger nominal GDP lowers any ratio that has GDP in the denominator. Investec economist Annabel Bishop estimated at the time that gross debt for 2020/21 would drop to 71.1% of GDP from 80.3%, with the deficit ratio narrowing as well, and cautioned that it still showed rising debt rather than stabilisation.
That is relevant now because the medium-term budget put gross debt on a path that peaks at 78.4% of GDP, as we reported, and because banks and economists are already discussing a possible rating upgrade, a theme we covered in Investec’s investment-grade outlook. If a rebase restates nominal GDP upward, the published debt ratio may shift without any change in government borrowing. Whether Treasury and the rating agencies treat that as a genuine improvement or a statistical one is not yet known, and Stats SA has not said how far back the new series will run.
What businesses should watch on Thursday
Three things deserve a close read when the data arrive. The first is sector weights. If the 2021 pattern repeats, services could look larger and the old picture of an economy dependent on mining and manufacturing could be revised further, which affects how analysts compare a sector’s performance with the whole economy.
The second is investment. Our report on investment falling to 13.6% of GDP used the old base, so that share, and the argument about the distance to the 20% and 30% targets cited by business leaders, will be recalculated. A bigger denominator would make an unchanged rand investment total look smaller as a share of the economy, though the direction depends on how fixed investment itself is revised.
The third is the quarterly growth path. Stats SA’s own release says the 0.2% contraction in the second quarter is preliminary and may be revised, and a rebase can alter recent quarters as well as history. Our earlier report on the second-quarter contraction rests on the old series. Forecasters, lenders and treasury teams that benchmark covenants, budgets or targets to GDP ratios should expect to update models once the new series is published.
What is still unknown
The size of the 2026 revision is not public. Nobody outside Stats SA and the Reserve Bank can say whether nominal GDP will rise by a tenth again, by less, or by more, and any forecast of the number is a guess. It is also not yet clear how the new data will treat informal activity, digital services or the energy sector, or how far back the revised history will go. The same Thursday brings September producer inflation, which Nedbank expects to accelerate to 5.3% from 5% in August, according to Business Day, so the day’s headlines may compete.
The sensible reading is that a rebase changes the ruler, not the economy. Businesses should wait for the actual tables before drawing conclusions about growth, tax capacity or debt, and should treat any ratio quoted on Thursday as belonging to the new series.
