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JOHANNESBURG - The latest SA Chamber of Commerce and Industry (Sacci) trade conditions survey shows it remained muted in November, with the trade activity index (TAI) still in negative territory at 45.

Sacci yesterday said the tougher trade conditions since September suggested a further decline in the value added by the trade sector as well as lower import volumes.

“The value added of the trade sector declined 1percent year-on-year in the first three quarters of 2017. New vehicle sales and export trade volumes performed better than general trade conditions indicate,” Sacci said.


The seasonally adjusted TAI was down by twoindex points last month, emulating the sluggish economy.

Sacci said the seasonally adjusted TAI was sevenindex points lower last month than a year ago.

However, the seasonally adjusted trade expectations index (TEI) improved to 59 last month - well above the borderline level of 50 since March.

Consulting economist for Mercantile Bank Trudi Makhaya said the country was unable to take advantage of a largely favourable global economic environment this year.

“The year was characterised by policy uncertainty, most visibly with regard to fiscal policy, where leadership changes have raised questions about the direction of the country’s finances.

“The economy remained tepid, as it has struggled to recover from the fallout from the Great Recession,” Makhaya said.

Sacci said sale volumes decreased last month with the sales volume index down from 56 to 49.

The new orders index, however, improved to 45 from 41 in October with expected sales volumes and expected new orders improving substantially into positive territory at 63 and 58 respectively.

The sales price index dipped noticeably by 10 points to 50 and the input price index six points to 66, while the employment sub-index remained flat at 43 last month.

However, Sacci said the employment outlook index for the next six months unexpectedly lifted by eight points last month from 41 in the previous month.

Negative prospects

Sacci said it was expected that nominal interest rates would remain unchanged and thus leave the real cost of finance relatively high. “The significant volatility of the rand against currencies of major trading partners, higher real interest rates, and high unemployment has fed negative trade prospects.”

Earlier this year, the Industrial Development Corporation said that difficult trading conditions in global markets and reduced-price competitiveness due to a relatively stronger rand might affect South Africa’s export performance this year.

However, multinational law firm Baker McKenzie said last month that South Africa’s deal activity was expected to improve as global economic and political risks ease and positive macro-economic deal drivers arose.