Speaker, the weaker than expected GDP data during the first three months of this year was heavily influenced by a number of sporadic factors that impacted negatively on growth.
Weak economic activity was primarily due to output losses in the manufacturing sector, which subtracted 1,2 percentage points from growth in the first quarter as a result of various supply-side disruptions. Hon members are also aware of the disruptions in the mining sector. Added to this are global economic factors that are beyond our control. A more liberal approach to product markets would not have avoided these negative developments. Given the temporary nature of the disruptions, we may expect a rebound in manufacturing activity during the second quarter of this year. We are also working with labour and the mining sector to resolve problems in that sector. It is important to note that South Africa's product markets perform relatively well in international comparisons.
The World Economic Forum's Global Competitiveness Report for 2012-13 ranks South Africa 32nd out of 144 countries in terms of its goods market efficiency, performing well across a number of indicators. We rank sixth for the effectiveness of antimonopoly policy and in the top 40 in terms of the extent of market dominance. We rank 31st in the extent and effect of taxation, 29th in the number of procedures to start a business, 39th in the prevalence of trade barriers, and 32nd in buyer sophistication.
The National Development Plan highlights the importance of lowering the cost of doing business in order to improve competitiveness. This includes actions to reduce regulatory burdens and to promote entrepreneurship and small business.
Recently we have made progress with a range of measures that will influence product markets and competition. These include the following: the signing of section 6 of the Competition Amendment Act, Act 1 of 2009 with amendments that give the Competition Commission powers to conduct a market inquiry, search and seize powers, and powers to summon firms to present information; progress towards establishing special economic zones, which will include a range of incentives aimed at attracting investment, reducing red tape and increasing competitiveness; the SA Revenue Service customs modernisation programme, which has moved customs procedures from paper- based to electronic processes, a process that has enhanced the flow of goods, improved turnaround times, and reduced trading costs; and a more favourable tax environment for small businesses, as government has increased the R14 million turnover threshold for small business corporations to R20 million. These measures and others identified in the National Development Plan and other policy documents of government will help in creating a product market that is conducive to growth, investment, firm start-ups and expansion, and job creation.
Hon member, it is a misconception that our economic growth in the first quarter was heavily adversely affected by our country's labour regulations. The crisis in the agricultural sector emanated from unequal relationships between employers and employees and the high levels of poverty as opposed to our country's labour laws. The challenges in the mining sector, as we have explained before, are also not as a result of our labour regulations, and these are being attended to in discussions facilitated by government. I thank you, hon Speaker. [Applause.]