BMR Macroeconomic and Retail Trade Sales Forecast for South Africa 2021

BMR Macroeconomic and Retail Trade Sales Forecast for South Africa 2021


The coronavirus pandemic has impacted business and consumer confidence, shifted production and delivery supply chains resulting in a significant disruption but also transformation of the retail trade sales sector in 2020 and possibly for years to come. The relaxation of the national lockdown to level one announced by the President at the end of February 2021 had re-opened some economic opportunities for low-income households, but a significant proportion of consumers will continue to be vulnerable financially under the adjusted level 3 lockdown. Getting back to pre-pandemic output levels will take time. Recovery to the 2019 level of output is only expected in 2023, reflecting sustained headwinds to economic activity, including high long-term investment costs, electricity supply constraints and rising oil prices that have increased the economy’s total import bill, offsetting some income gains from a stronger term of trade.

Key Macroeconomic Forecasts 2021

South Africa economic growth is expected to rebound in 2021, underpinned by a global recovery and a commodity price upswing, which will support the key mining sector and which, combined with the prospect of a second consecutive bumper harvest, a tax-neutral budget and signs of a resumption in investment and construction will strengthen productivity and output. Overall, risks to the domestic growth outlook are assessed to be balanced. Global growth, progress in vaccination, a low cost of capital, and high commodity prices are all supportive of growth. However, new waves of the Covid-19 virus are likely to weigh on economic activity both globally and locally. In addition, ongoing constraints to the domestic supply of energy and uncertainty about vaccine rollout continue to pose downside risks to growth. Taking these aspects into account the BMR probabilistic macroeconomic model, predicts the South African economy to grow by 3.0% and for 2021 to be a more favourable year than 2020 in terms of the key macroeconomic indicators presented in the table 1 below.

Trends in Real Retail Trade Sales Growth 2013-2020

Figure 1 presents the annual growth in real retail trade sales in South Africa confirming that the sales have been registering a declining trend during the last eight years from a high of 2.7% in 2013 to a low of -6.9% in 2020.

Real Retail Trade Sales Forecast 2021

By taking into account the prospects of both the 2021 global, regional and local economies, the impact and progress in the roll out of the Covid-19 vaccination programmes, the BMR estimates formal retail sales to grow by 2.0% in real terms during 2021 with the highest growth projected for retail outlets in household furniture, appliances and equipment (5.3%), followed by pharmaceutical and medical goods, cosmetics and toiletries (3.8%), and general dealers (2.7%) as reflected in figure 2.

Real Household Consumption Expenditure Forecast 2021

Growth in consumption expenditure is normally attributed to two major components, namely, price inflation and an increase in demand.  The BMR forecasts household retail expenditure by product group in constant terms, to increase for most of products.  Overall, durable goods are anticipated to grow the most by (3.8%) while services and non-durables are likely to expand by (2.5%) and (2.3%) respectively and lastly semi-durables are expected to contract by (-0.8%) and services to increase by (2.9%) as depicted in figure 3.

Figure 4 confirms that in terms of retail outlets, the highest expansion in demand by product during 2021 is expected with respect to recreational and entertainment goods (8.8%) followed by household furniture, appliances, and equipment (6.5%) and thirdly computers and related equipment (5.7%).


The 2021 BMR retail sales forecast shows that retail sales are anticipated to increase by 5.8% in nominal terms and by 2.0% in real terms.  This forecast reflects an expansion in sales in terms of volumes for 2021 though from a low base given the impact of the Covid-19 pandemic in 2020. The second wave of the pandemic was strong but had minimal direct impacts on the global economy. Countries addressed second waves by implementing better targeted and less economically damaging lockdowns, unlike the tight restrictions implemented during the first wave. In tandem, businesses have, where possible, adapted or shifted to less contact-intensive ways of working, further insulating production activity and many jobs from restrictions on mobility and contact. Similar cautious strategies are being adopted for the emerging third waves.

For any enquiries regarding the research study, please contact Prof PK Kibuuka (Research Director, Bureau of Market Research) at

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