All eyes on Ramaphosa as positive sentiment offset by municipal woes
The level of business confidence in South Africa was little changed in June compared with May, as all players looked to decisive action from President Cyril Ramaphosa in dealing with corruption, incompetence and non-performance, the SA Chamber of Commerce and Industry (Sacci) said yesterday.
Sacci’s business confidence index (BCI) ticked up 0.3index points to 93.3points in June from May. This is the lowest the index has been in the month of June since 2012. Six of the 13 sub-indices of the composite BCI improved on their May levels while three declined and four were unchanged.
Notable positive monthly effects came from the number of new vehicle sales, the real value of building plans passed; manufacturing output; and an increase of the all-share price index of the Johannesburg Stock Exchange.
Sacci said the positive sentiment after Ramaphosa’s election in May on the one hand, versus recent reports of dire financial strain in most state-owned enterprises and municipalities, coupled with the auditor-general’s latest negative report for most municipalities on the other, “leaves one with a sense that the two positions are cancelling each other out at this stage, when in fact it’s still too early for realistic business confidence sentiments to develop.
“What is clear is that all South Africans are expecting decisiveness on the part of the government to deal with corruption, incompetence and non-performance, and certainty in urgent implementation of policies to drive economic growth and job creation,” it added.
Sacci said the present level of business confidence was not at ideal levels, but could gain momentum once there were signs that the implementation of set plans and policies was a priority.
“The upcoming government- and private sector-driven investment summits and the mid-term budget policy statement later in the year should provide more clarity and detail necessary for businesses to make immediate medium- and long-term investment plans,” Sacci added.
African News Agency (ANA)