Photo by: Bloomberg
Business confidence among South African CEOs remained subdued in the second quarter of this year, with labour unrest in the platinum mining sector having “placed a major drain” on the economy, the latest Merchantec CEO Confidence Index has found.
Although the index, which is released quarterly by independent equity and debt sponsor and research and corporate finance advisory company Merchantec Capital, recorded a marginal increase of 1.4% quarter-on-quarter to 51.7 points in the second quarter, confidence remained low.
CEOs were especially concerned over the impact of labour unrest in the basic materials sector, and particularly the five-month strike action by employees in the platinum mining industry, with this subcomponent of the index having recorded a 16.6% decrease to 45.4 points in the second quarter.
Merchantec Capital noted that CEOs were expecting the labour unrest to have an impact on the local economy for months to come.
Meanwhile, a 3.2% decrease to 52.8 points was recorded in the technology subcomponent of the index.
The decreases in these two sectors were, however, offset by increases of 10.4% 6.7%, 3% and 2.6% in the consumer services, financial, consumer goods and industrial sectors of the index respectively.
The Merchantec CEO Confidence Index includes views from CEOs of top South African companies and indicates how business leaders perceive local market conditions and the state of the economy.