Photo by: Bloomberg
The South African Chamber of Commerce and Industry (Sacci) Business Confidence Index (BCI) performed better in December 2013 than in November 2013 month-on-month, with the BCI increasing by 1.1 index points to 91.9 in December from 90.8 in November.
Although this is the highest reading for the BCI in the second half of 2013, Sacci noted in a statement on Thursday that it was 1.1 index points below the December 2012 level.
The average level for the BCI in 2013 was 91.4 compared with an average of 94.1 in 2012. In relation to previous years, 2013 presented the worst yearly performance for the BCI since 1999 when the BCI averaged 87.6 and the business cycle was in a downward phase. The average for the 2013 BCI was 8.1 index points below the level of 100 for the 2010 base year and 27.6 index points below the yearly peak of 119 in 2006.
Four subindices of the BCI did not move significantly between December and November 2013, five had a negative impact, while four positively influenced the BCI in December 2013. Year-on-year, four subindices made positive contributions to the BCI, eight had a negative impact and one was neutral. Major activities such as exports and manufacturing improved year-on-year, while municipal services and lower real financing cost also contributed, albeit to a lesser extent, to the December 2013 uptick in the BCI.
Sacci said the economic outlook for 2014 remained varied from cautiously optimistic to concerns about a risk-prone environment.
“This year’s business climate and South Africa’s economic performance for the longer term depends on the country’s approach to certainty in its economic policy direction, institutional capacity to implement policy, aligning policy positions with the National Development Plan, supporting the private sector as the vanguard of economic growth, sticking to economic recipes that have proven sustainable outcomes, positioning to take advantage of improvements in global economic performance, dealing with local short-term economic weaknesses and structural economic bottlenecks,” noted the chamber.