The SA Chamber of Commerce and Industry Business Confidence Index for September was released on Tuesday at the SACCI Offices in Rosebank, Johannesburg.
The BCI increased by another 0.2 index points in September to 89.2 after improving by 1.1 index point in August 2014.
Sacci says in a statement that although it appears that waning business confidence has been checked, business confidence remains at an undesirably low level.
Such a low confidence level was last observed in early 2000.
It says its concerned that prospects for the South African economy are becoming more desperate as economic performance and the business mood are at a low ebb. A series of negative economic and socio-political developments are also putting the economic outlook under severe pressure.
Here is the full statement:
Business Confidence Remains Unacceptably Low
The SACCI Business Confidence Index (BCI) for September 2014 was released today at the SACCI Offices in Rosebank, Johannesburg. The BCI increased by another 0.2 index point in September 2014 to 89.2 after improving by 1.1 index point in August 2014. Although it appears that waning business confidence has been checked, business confidence remains at an undesirably low level. Such a low confidence level was last observed in early 2000.
The September 2014 BCI was 2.2 points below the September 2013 level of 91.4. The BCI averaged 90.3 in the first three quarters of 2014 compared to 91.4 in the first nine months of 2013. It is of concern that the poor business confidence performance is extended over such a long period - an average of 91 for the SACCI BCI since December 2012.
Although four of the seven physical activity sub-indices were positive month-on-month compared to three in August 2014, none of the six financial sub-indices of the BCI was positive. More depressed levels of real economic activity (the BCI covers seven such sub-indices indicative of the real economy) than a year ago (y/y) reflect a significant handicap on the business climate. The lower y/y level of business confidence in September 2014 came largely from a more constrained financial environment than a year ago. All six financial sub-indices weighed negatively on the BCI. It appears that the disruptions of the real economy in the first half of 2014 lead to broader consequences as it impacted various financial indicators.
SACCI is concerned that prospects for the South African economy are becoming more desperate as economic performance and the business mood are at a low ebb. Needs, expectations and demands are not commensurate with output, supply and value added. A series of negative economic and socio-political developments are also putting the economic outlook under severe pressure.
The MTBPS, soon to be presented by the Minister of Finance, is a critical policy event from the point of view of creating certainty in terms of fiscal direction. Apart from responding to a weakening financial environment and addressing public finance issues, the MTBPS is also looked upon for directional change in terms of spending priorities, debt management, efficacy in the application of taxpayers' money, accountability and delivery.
