South Africa’s private-sector activity slows to 20-month low in December

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JOHANNESBURG, Jan 4 (Reuters) – South African private-sector economic activity contracted for a fifth consecutive month in December as factory output and new orders fell, a survey showed on Thursday.

The Standard Bank Purchasing Managers’ Index (PMI), compiled by IHS Markit, fell to 48.4 in December from 48.8 in November, staying below the 50 mark that separates expansion from

contraction for a fifth straight month. It was the lowest reading April 2016.

Lack of demand and therefore output led companies to continue to cut workforce numbers, purchasing activity and inventories. The country shed 83 000 formal jobs between

September 2016 and September 2017, Statistics South Africa said in December.

A reduction in business activity was the main influence over the decline in business conditions, the survey said.

Contractions in output were linked to a lack of client demand and challenging market conditions, it said.

Africa’s most industrialised economy emerged from a recession in the second half of 2017, but growth is expected to remain subdued following credit downgrades to “junk” by S&P Global and Fitch. Business and consumer confidence remain at record lows.

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Godwin Okafor is a financial journalist, Internet Social Entrepreneur and the Founder Naija247news Media Ltd He has over 16 experiences in journalism, which cuts across traditional and digital media. He started his journalism career in Business Day, Where he was a senior editorial graphic artist, before he left to start Naija247news, An Online Financial Newspaper in 2010. He has won series of awards and he is the chairman of Emmerich Resources Limited, the publisher of Naija247news.com and also sits on the board of Students In Business Awards, (SIBA). He currently lives in Manhattan New York

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