With business confidence remaining virtually unchanged from September to October, South Africa is not in a position to take advantage of the improving global economic climate, according to the South African Chamber of Commerce and Industry (Sacci), which on Wednesday released its October 2017 Sacci Business Confidence Index (BCI).
After the Sacci BCI recovered by 3.4 index points to 93 in September from a low in August, the BCI stagnated at 92.9 in October, which is not far off October 2016’s reading of 93.
The average BCI reading for the first ten months of 2017 was 94.1, compared with the first ten months of 2016, which recorded an average BCI reading of 93.4, and the first ten months of 2015, which recorded an average BCI reading of 101.
Thus, the 2017 BCI average signifies a decline of 7.1 index points from the 2015 BCI average.
However, positive month-on-month movements were evident in five of the thirteen sub-indices of the BCI in October, though five sub-indicators reflected negative moves and three did not change from the September reading.
Higher merchandise import volumes made the largest positive impact on the October BCI, followed by merchandise export volumes and increased real retail sales.
The unchanged year-on-year BCI in October 2017 was the net result of seven sub-indices that improved from a year ago, four sub-indices that were worse off, and two that remained unchanged.
Lower inflation, improved new-vehicle sales and the higher real value of building plans passed were the main movers, causing a positive year-on-year impact on the BCI.
Sacci said it was convinced that the only appropriate avenue to generate growth in South Africa is to nurture investors and the business environment to obtain a sustainable economic performance that generates the fiscal space, jobs, greater opportunity, inclusivity and wealth.