The adverse domestic and global business and economic conditions experienced in December continued in January, impacting on the South African Chamber of Commerce and Industry (Sacci) Business Confidence Index (BCI), which measured 80.

While the index had improved marginally by 0.4 index points from the 79.6 recorded in December, it was 9.3 points lower than in January 2015.

The month-on-month changes of the BCI subindices were more encouraging than those recorded in December, with five indices making positive month-on-month movements, three remaining neutral and five turning negative.

Four real activity subindices and one financial subindex contributed positively month-on-month in January.

“This year started on the wrong footing as the global economy is going through an adjustment phase, while some economies are experiencing tough structural corrections. It is important that these latter economies keep to prudent and sustainable economic policy to at least ensure that they do not add to the inevitable present global economic woes.

“There are no quick fixes to provide an instant panacea for longstanding structural challenges. It is, however, important that action be seen as credible, feasible and consistent in order to re-establish investor and business confidence,” Sacci said in a statement.

It added that, in addition to global economic misfortunes, South Africa had experienced homegrown concerns that worsened the economic and business climate.

“Not only were the economy and its performance affected, but it also had a bearing on public finance and several public sector institutions and tiers of general government to deliver goods and services,” Sacci stated.

The credit downgrade during December by credit rating agencies and the possibility of these agencies giving South African government bonds junk status, was also a major cause for concern.