South Africa has officially recorded its third quarter of contraction after the latest GDP figures revealed the economy declined by 3.0%.

Statistics South Africa reported that the economy contracted by 3.0%, following a 6.4% contraction in the first quarter of the year. The economy also contracted by 1.8% in the final three months of 2008.

The main reason for the decline was a 1.6% decline by the manufacturing industry and a 0.6% decline by the wholesale and retail trade, hotel and restaurant industry.

Commenting on the figures, Nedbank said “Economic conditions will remain weak for the rest of this year, but some levelling out is expected in the third quarter followed by a slightly better performance in the final quarter.”

The bank is currently forecasting an overall decline in GDP of 2% for 2009, with a return to growth of 1.7% in 2010.