Jun 12, 2012
Second-quarter building confidence fallsBack
Building|First National Bank|Cees Bruggemans
© Reuse this
However, despite the fall in confidence, with 7 out of 10 respondents in different sectors of the building industry rating the prevailing business conditions as unsatisfactory, the index remained higher than that recorded for most of 2011.
The FNB/BER business confidence index results found that despite steady performance in the building sector during the second quarter of the year, the industry held no improvements as was anticipated – highlighting the slow, somewhat hesitant nature of the building sector recovery.
“The underlying data on activity and profitability does not suggest that the recovery has stalled, rather that the pace of the recovery remains very slow,” said FNB economist Cees Bruggemans.
Further, he added that increased domestic and global uncertainty may have dampened confidence and contributed to the divergence between confidence and activity.
Nonresidential contractors recorded the largest shift in confidence with a decrease from 38 index points to 19 during the second quarter, while the confidence of residential contractors remained largely flat, decreasing by 2 index points, from 28 to 26.
Bruggemans pointed out that the nonresidential sector continued to outperform the residential sector with no indication of a slowdown in the sector.
The business confidence of main contractors fell 7 index points to 24 points, while subcontractor confidence rose from 29 to 32 index points. Business confidence among architects and subcontractors rose by 13 and 3 index points, respectively.
The index reported another significant drop in confidence from building material and hardware retailers, with -29 index points, followed by manufacturers at -17, main contractors at -7 and quantity surveyors at -5.
“Despite the 7 index point decline in building confidence, the underlying information about activity and profitability suggests that the recovery is still on track, but, at a very sluggish pace, perhaps even slower than previously thought,” said Bruggemans.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Other Construction News
Phase 3 construction of the Maclear Wastewater Treatment Works (WWTW) upgrade project, in the Eastern Cape’s Joe Gqabi district municipality, will start in June this year, says South African black-owned engineering firm Gibb, This phase will include the construction...
Updated 3 hours ago Top aluminium producer United Company Rusal will start producing metal at its Boguchansk project, in Russia, by June and will ramp up output over the following year depending on demand, the company's chief executive said on Monday. Weak aluminium prices are forcing...
Updated 3 hours ago Dubal Holding, the holding company for Dubai's stake in Emirates Global Aluminium and other assets, is considering possible acquisitions in local and international energy projects, it said on Monday. The firm was looking for equity interests related to coal, solar,...
Recent Research Reports
Steel 2015: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2015 report provides an overview of the key developments in the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon...
Projects in Progress 2015 - First Edition (PDF Report)
In fact, this edition of Creamer Media’s Projects in Progress 2015 supplement tracks developments taking place under the Renewable Energy Independent Power Producer Procurement Programme, which has had four bidding rounds. It appears to remain a shining light on the...
Electricity 2015: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2015 report provides an overview of State-owned power utility Eskom and independent power producers, as well as electricity planning, transmission, distribution and the theft thereof, besides other issues.
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
This Week's Magazine
Forest products group Sappi has confirmed the selection of its 25 MW biomass-to-power project, to be erected at its Ngodwana mill, in Mpumalanga, as a preferred bidder under the South African government’s Renewable Energy Independent Power Producer Procurement...
Information and communications technology (ICT) distributor DCC is making Windows- and Android-operating systems tablets available through retailers and education equipment suppliers to provide school children with affordable, high-performance education tools. The...
Another cement manufacturer is set to enter the Ugandan market, raising hopes that prices will come down and spur growth in the construction industry. National Cement, a Kenyan manufacturer, has unveiled plans to invest $195-million in a new manufacturing plant in...
With growth rates exceeding that in the developed world – at an average of between 4% and 5% between 2002 and 2014 – African countries provide investors with ample reason to tap into booming consumer demand says Manufacturing Circle executive director Coenraad...
The South African Chamber of Commerce and Industry’s (Sacci’s) Business Confidence Index (BCI) decreased by 3.7 index points month-on-month to 89.1 in March.