South Africa’s business climate deteriorated in May to its weakest level in 16 years, reflecting the domestic economic slowdown and electricity shortages, lack of policy direction and experimenting with unviable policy options, and a still feeble recovery of the world economy, the South African Chamber of Commerce and Industry (SACCI) said in a statement.
The Business Confidence Index (BCI), produced by SACCI, lost 3.0 points m/m to 86.9 in May, its lowest level since September 1999. It was by 2.0 points below its year-ago level and by 3.1 points below the average for 2014. The index averaged 89.6 in the first five months, compared to 91.3 in the same period last year.
South Africa is in dire need of foreign capital for financing struggling public sector institutions, infrastructure and compliment overall local fixed investment, but the business and investor climate are not convincing, SACCI said. A possible outflow of capital may become a harsh setback for longer-term economic performance, it warned.
| Impact of the BCI sub-indices on the overall BCI | May-15, m/m | April-15, m/m | May-15, y/y | April-15, y/y |
| Physical activity sub-indices | ||||
| Municipal Services | + | o | - | - |
| Manufacturing | + | + | + | - |
| Exports | - | + | - | + |
| Imports | - | + | + | + |
| Vehicle sales | - | - | - | - |
| Retail sales | - | + | - | - |
| Construction - buildings | + | o | + | - |
| Financial sub-indices | ||||
| Inflation | o | + | - | o |
| Share prices | o | + | - | - |
| Real private sector borrowing | + | + | - | o |
| Real financing cost | o | - | o | o |
| Precious metal prices | o | o | - | - |
| Rand exchange rate | - | + | - | o |
| Source: SACCI |
Related Articles
South Africa’s power utility Eskom seeking ways to support Bitcoin mining, energy-intensive technologies
South Africa’s state-owned power utility Eskom is exploring opportunities to support Bitcoin mining, artificial intelligence (AI) development, and data centres to help its future ... more
EFCC arrests ex-NNPCL official and previous Warri managing director
Nigeria’s Economic and Financial Crimes Commission (EFCC) has arrested a former CFO of the Nigerian National Petroleum Co. Ltd (NNPCL), as well as a former managing director of 125,000 barrels per ... more
Fitch warns Ghana’s reserves at risk if gold prices plunge amid global geopolitical shifts
A sharp fall in global gold prices, now sitting above a record-high $3,300 per ounce, could rapidly erode Ghana’s international reserves and trigger fresh economic instability, ... more