The Business Confidence Index (BCI) published by the South African Chamber of Commerce and Industry (Sacci) has nudged up by 2.9 index points to 111.5 in November, from 108.6 in October.
The BCI is at a similar level to November last year when it stood at 110.9.
Increased inward tourism, higher merchandise import volumes and lower core inflation were the standout positive contributors on a year-on-year basis.
However, fewer new-vehicle sales, the weaker and more volatile rand exchange rate and high real financing costs were the main negative factors impacting on business confidence year-on-year in November.
The latest BCI reading suggests that the business climate and economic conditions did not provide the spark for increased confidence over the medium term and that, while it did recover a few index points in November, this does not necessarily mean the business climate has become favourable or that upward momentum has been fully restored, Sacci explains.
Notably, inward tourism and merchandise import volumes made the most positive contributions to business confidence in November.
In the first 11 months of the year, the BCI averaged 109.4, compared with 109 in the first 11 months of last year. “It seems like there is a lack of positive momentum in business confidence, with several lingering economic challenges yet to be resolved,” Sacci states.
Between October and November, six out of 14 BCI subindices showed positive changes, while five remained virtually unchanged.
Three subindices had a negative impact on business confidence during this period.
Most of the positive upticks in business confidence in November came from civil society and businesses showing resilience and endurance, Sacci says, adding that the public sector’s efforts could inspire investor confidence and foster higher economic growth going forward.
“Creating such a positive environment requires fostering appropriate international relations and ensuring supportive human and fixed capital stocks, especially in a dynamic economy like South Africa's,” Sacci states.