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Statistics South Africa (Stats SA) will release the country’s second-quarter GDP figures later today. The Common Sense expects annual growth to slow to 1.2% in the second quarter of 2026 compared to an annual growth rate of 1.9% in the first quarter.

A leading reason for the softer growth number is weak confidence.

Business confidence fell to 39 points in the second quarter, from 47 points in the first quarter (a reading below 50 means most businesses see conditions as unfavourable). Consumer confidence fell to negative 19 points in the second quarter compared to negative seven points in the first quarter (a negative reading means more households expect their finances to worsen than improve).

The chart below shows South Africa’s business and consumer confidence trendlines since 1994.

Much more useful than any single quarterly GDP number is understanding the longer-term trendline and where it is headed, and here the call is easy.

Business confidence is now less than half the level recorded in 2007 and is also much lower than when government and business launched their National Development Plan (NDP) in 2012. That has helped drive fixed investment below 15% of GDP, much lower than when the NDP was launched, and 10 percentage points behind South Africa’s emerging-market peers.

The result is that the economy remains effectively pinned somewhere near an annual growth rate of 1.0%. Quarter to quarter, the GDP number will bounce above and below that level, but over time the numbers are likely to average around 1.0% or thereabouts.

The chart below shows South Africa’s rate of economic growth since 1994.

The trend you see in the later years of that chart will only change if there is a major shift in the political or policy environment away from the current Government of National Unity (GNU) status quo.

For example, an African National Congress (ANC) move to the hard left that fractures or sinks the GNU would crash what confidence, investment, and growth there is.

To the upside, an ANC leadership change to Patrice Motsepe could materially improve confidence and investment, causing the economic growth rate to lift.

For now, however, Bheki Mahlobo tells The Common Sense, “There is little in government policy to suggest that the country could move far off the roughly 1% or thereabouts growth rate track that it has been on for the past couple of years.”