South African business confidence index edges up in December

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Workers sort avocados at a farm factory in Nelspruit in Mpumalanga province, about 51 miles (82 km) north of the Swaziland border, South Africa, June 14, 2018. Picture taken June 14, 2018. REUTERS/Siphiwe Sibeko

JOHANNESBURG (Reuters) – South African business confidence improved slightly in December as imports rose and more building plans were passed, but extensive power cuts meant sentiment was still weak, a survey showed on Thursday.

The South African Chamber of Commerce and Industry’s (SACCI) monthly business confidence index (BCI) edged up to 93.1 in December from 92.7 in November.

SACCI said four of 13 sub-indices improved, three weakened and six were broadly unchanged.

“The economy’s potential is wavering and requires positive corrective steps,” it said in a report accompanying the survey.

Low levels of business confidence and have been a major drag on investment in Africa’s most developed economy, complicating President Cyril Ramaphosa’s efforts to revive growth.

Ramaphosa pledged comprehensive reforms when he took over in February 2018. But he has found it hard to push through his agenda given severe fiscal constraints, power cuts and entrenched opposition, hurting investor sentiment.

Troubled state power utility Eskom is struggling to meet electricity demand due to breakdowns at its unreliable coal-fired power stations.

It has been forced into several rounds of power cuts that have hobbled economic growth, with the most severe cuts experienced in December last year.

SACCI said the BCI declined from an average of 95.5 in 2018 to 92.6 in 2019.

Reporting by Alexander Winning; editing by Olivia Kumwenda-Mtambo

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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