Professional services firm EY’s growth barometer for South Africa 2018 showed that 58 percent of middle-market companies were targeting growth of between 6 and 10 percent. About 32 percent of companies had the same growth ambitions a year ago.
A further 30 percent were targeting growth in excess of 10percent, while only 12percent of respondents expect a decline in growth.
The study further found that the country’s respondents were also among the most bullish of the BRICS group on export growth, trailing only China.
Azim Omar, Africa growth markets leader at EY, said business confidence had soared since Cyril Ramaphosa became president in February.
“Economic growth forecasts are stronger this year, whereas last year there was a risk that we were heading for a recession,” Omar said.
The SA Chamber of Commerce and Industry (Sacci) was expected to release its July business confidence index today. Last month, the chamber said sentiment fell to 93.7 points in June, compared with 94 points in May.
June’s decline in business sentiment also marked a spectacular fall in the index, which reached a two-and-a-half-year high of 99.7 points in January as Ramaphoria gathered steam.
The study also found that insufficient cash flow was the greatest challenge for 32percent of the South African C-suite respondents, while 15 percent flagged a lack of skilled talent the third-greatest challenge to growth.
Meanwhile, EY found that woman-led companies across the world were significantly affected by a lack of funding, with 18percent citing access to capital as a major barrier to growth, compared with 11percent of their male-led peers.
“We continue in South Africa to be placed as a diversity leader with 15percent of respondents’ chief executives being female versus 3percent for the rest of the world,” Omar said.