Wednesday, June 8, 2016
UK industrial output grows fastest in four years; South Africa flirts with recession; When meal kits become the trend
1 UK industrial output grows fastest in four years (Julia Kollewe in The Guardian) British industrial production grew at the fastest pace in almost four years in April, boosted by the pharmaceuticals and energy sectors.
The official figures, which took the City by surprise and sent the pound higher, are in contrast with other economic data that has pointed to a slowdown in the economy before the EU referendum on 23 June.
Manufacturing output grew by 2.3% in April from the previous month, while the wider measure of industrial production, which also includes mining, oil and gas, posted a 2% rise. Both were the biggest increases since July 2012, according to the Office for National Statistics. City economists had expected flat readings.
Pharmaceuticals output jumped 8.6%, the biggest monthly rise since February 2014, with evidence of large export orders in the industry. Gas and electricity output rose 3.9% due to unusually cold weather, the ONS said. Both sectors are volatile. In the three months to April, industrial output rose by 0.7%, the first increase this year.
Manufacturing accounts for about a tenth of the economy and remains 6.4% below its pre-financial crisis peak. The wider economy slowed in the first quarter to 0.4% GDP growth, compared with 0.6% in the final quarter of 2015. Business surveys suggest economic growth could slow further to just 0.2% between April and June.
Their commitment to the plan was made as Statistics SA released the latest growth figures confirming that South Africa's economic prospects are spiralling downwards. The decision by Fitch Ratings to hold the country's sovereign credit rating at the lowest investment-grade level, fractionally above junk status, and to maintain its outlook at "stable", should spur South Africans into working harder to improve the economic outlook, Ramaphosa said.
He said the government, and all business sectors, must agree on a plan to rescue one of Africa's biggest economies and keep its rating. Stats SA painted a gloomy economic picture. It said the country's real gross domestic product contracted by 1.2% in the first quarter of the year. An 18.1% fall in the contribution to GDP of the mining and quarrying sector led the contraction.
Transport, storage and communications shrivelled by 27%. Other economic sectors that dragged down GDP were agriculture, forestry and fishing, and electricity, gas and water. Fitch Ratings said that it was worried by South Africa's poor GDP growth.
Gauteng carries the future of the country on its shoulders, Gordhan said. The economy talks were organised by the Gauteng government. He said that South Africa still had the best investment infrastructure on the continent - the question was how to use it to best advantage.
Gauteng's economic development MEC, Lebohang Maile, said the global economy was not doing well and this had prompted the provincial government to look at ways of intervening to solve the problems facing the country. Business leaders complained about the profusion of red tape and the government's slowness to act to stimulate the economy.
Helping breathe new life into dinner or lunchtime, meal kits supply pre-measured ingredients and full recipe instructions, which aim to help make the process of cooking at home as simple as the 1950s fantasy. The industry - which has its roots in Sweden - had $1bn in global sales in 2015. And this is expected to increase to $5bn over the next 10 years, according to consulting firm, Technomic.
Big players like US firms Blue Apron and Plated, UK businesses Guousto, and Germany's Hello Fresh, have done a lot of the ground work, educating consumers and getting them comfortable with the idea of ordering measured ingredients that they cook themselves. Now smaller, niche players are getting in on the act, offering specific meal kits tailored to particular dietary preferences, food styles and health trends.
As people become more comfortable with the meal kit ordering concept the jump to ordering all sorts of foods to prepare at home is likely to only grow further, forever changing what it means to be a home chef.