oa Agriprobe - The potential impact of productivity losses as a result of the electricity shortages in South Africa

Volume 5, Issue 1
  • ISSN : 1810-9799



South Africa is currently facing electricity shortages, which affect power supplies throughout the country. Load shedding and power outages have effects on industries, services, households and traffic, with negative implications for the productivity of the South African economy. This paper presents results on the potential impact of a one percent decrease in productivity in the South African economy. The results indicate that a productivity loss of one per cent could lead to a decrease of three per cent of the current level of GDP, representing a loss of approximately R52 billion. Consumer prices are likely to increase up to 1.09 per cent. Imports and exports are likely to decrease on average by 2.93 and 4.16 per cent respectively. The general contraction of the economy leads to a net decrease in employment opportunities of 129 100. This also leads to an average decrease of 2.70 per cent in labour incomes and a decrease of 2.81 per cent in household incomes. The lower household incomes coupled with consumer price increases lead to a welfare loss for South African citizens.

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