SA business confidence plunges to 35-year low
JOHANNESBURG - Business confidence in South Africa in April plunged to its lowest level since January 1985 as activity was brought to a halt during the strict lockdown to limit the spread of the coronavirus disease.
The South African Chamber of Commerce and Industry (Sacci) said the business confidence index (BCI) sank to 77.8 in April from 89.9 in March.
"Striking negative monthly impacts on the index were caused by the lower volume of merchandise exports, the weaker exchange rate of the rand, and less new vehicles sold – all mainly due to the lockdown,” SACCI said.
New vehicle sales plummeted by 98.4 percent or 36 213 units in April as the lockdown containment measures applied to flatten the curve restricted manufacturing activity.
The IHS Markit’s Purchasing Managers’ Index (PMI) yesterday tumbled to its largest one-month fall, posting the lowest reading since July 2011.
The PMI tumbled to 35.1 in April from 44.5 in March as output levels collapsed due to company closures and falling client demand.
International trade flows have been severely impacted by the current global situation.
One of the country’s largest business lobby, Business for South Africa (B4SA), has called for the acceleration of the phased reopening of the economy.
B4SA said yesterday this must be done to prevent an economic plunge that would be as much as 17 percent on the coronavirus lockdowns.
It said between one million to four million formal and informal sector jobs were at risk, despite the R500 billion stimulus package.