South Africa's economy slowed for a third straight year in 2024 but dodged a recession in the final quarter as the agricultural sector rebounded following a drought, official data showed on Tuesday.

The country's gross domestic product (GDP) expanded 0.6% last year compared to 0.7% in 2023, according to the StatsSA statistics agency.

The economy has been slowing for three straight years after bouncing back from the COVID-19 pandemic in 2021.

But South Africa avoided a technical recession — defined as two straight quarters of contraction — as it grew 0.6% between October and December compared to the third quarter, when it shrank by 0.1%.

'Welcome recovery'

The government said the growth was "encouraging and signals a welcome recovery."

The fourth-quarter growth was mainly driven by the agriculture, finance and trade sectors. The agricultural sector grew 17.2% in the fourth quarter, contributing to 0.4% points of total growth, StatsSA said.

The drought had caused a big drop in agricultural production in the third quarter. The centre-right Democratic Alliance (DA) party, a coalition partner in the government of national unity, said the figures showed a "stagnant" economy.

"Unless urgent action is taken, the country will continue to slide deeper into economic decline," it said.

'Getting poorer'

"South Africans are getting poorer year after year," it said. The party is in a tug-of-war with the ruling African National Congress (ANC) over a proposal to increase the value-added tax to fund the national budget.

The disagreement last month delayed the unveiling of the budget but a new date has been set for March 12. South Africa's inflation rose to 3.2% in January.