Johannesburg – The South African Chamber of Commerce and
Industry says its Business Confidence Index declined by 2.2 point from January
to February.
The index is now at 95.5.
In a statement released on Wednesday, the chamber said the
index nevertheless improved by 2.8 points on the February 2016 level of 92.7
and this is the third successive month that the BCI improved on the year ago.
The improvement of the BCI over the last five months
points towards the stabilisation of the business climate in South Africa caused
by changing local and global economic and political circumstances, SACCI says.
Although no ideal growth enhancing Budget, the Minister
of Finance succeeded, under difficult circumstances, to remain within the
expected framework, it notes. “More progress in the management of public
finance matters in particularly, should enhance economic prospects and widen
the prospects for an improved business mood.”
The year-on-year movements in the sub-indices
show that the business climate tightened slightly between January 2017 and
February 2017, but was less troubled than before the fourth quarter of 2016,
SACCI notes.
The stronger rand exchange rate again made the largest
positive year-on-year contribution to the BCI, followed by lower inflation and
higher gold and platinum prices. Substantially less merchandise import volumes
than a year ago made a particular negative contribution, it adds. Higher real
finance costs, increased energy costs (crude oil and electricity), and lower
share prices on the JSE, further weighed on business confidence, SACCI
explains.
Important incidents that occurred during the month of
February 2017 could have a bearing on the economy over the medium and
longer-term. Amongst the important developments is the announcement of the
national minimum wage, Budget 2017, increasing commodity prices including crude
oil, a stronger rand exchange rate, and the persevering of an internationally
acclaimed financial system, says SACCI.
On an annual basis, the business climate has improved
slightly in February 2017 in anticipation that the positive developments would
eventually outpace negative instances in the economy and business in general,
it says.
All indications are that economic growth will pick up as
the implementation and prudent authority takes hold.
“The business climate could further be improved if the
constructive present economic developments could be augmented. Business and
investor confidence depend on whether this window of opportunity will be seized
and the more positive sentiment be supported by responsible governance and
accountability. “
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