According to Sacci’s report, released on Thursday, trade conditions remained subdued in November and in negative territory. Photo: Pixabay

JOHANNESBURG – Trade conditions in South Africa will decline over the next six months as expectations weakened last month due to power cuts, according to the SA Chamber of Commerce and Industry (Sacci).

Eskom began implementing rotational power cuts this month and this will continue next week until unplanned breakdowns at its coal-fired power stations are addressed. Load shedding has had a negative impact on all sectors of the economy, from small and medium-sized enterprises to big corporations, as businesses rely heavily on a stable electricity supply.

According to Sacci’s report, released on Thursday, trade conditions remained subdued in November and in negative territory. 

Sacci’s seasonally adjusted Trade Expectations Index slid from 49 points in October to 46 points in November. The seasonally adjusted Trade Activity Index, a measure of recent trade conditions, improved slightly by 1 point to 43 points in November.

Sacci said present trade activity and trade expectations were on a similar level to November last year. 

It said respondents mentioned power instability as a debilitating factor affecting the business climate, as this was likely to continue for some time to come.

“All components of trade activity are expected to decline over the next six months except for sales prices and input costs that are expected to ease further,” Sacci said.

“During November, sales volumes, new order and prices were sustained. Black Friday, although not having a noticeable effect in this survey as it took place late in November, would nevertheless have had a positive impact on sales volumes in the last week of November.”

Sacci said market conditions remained difficult with continued pressure on sales prices, while input costs remained high. 

It said the property market for offshore properties was active, despite a depressed domestic housing market due to uncertainty with the expropriation bill issued by the government. 

Sacci said 2019 was being cited as a particularly difficult year for local and international trade. It mentioned sporadic strikes at state-owned companies such as SA Airways, saying that disruptions had a bearing on the trade environment.

The employment sub-index was virtually unchanged at 40 points – 1 point down on October. But Sacci said employment opportunities remained tight as the sub-index on employment prospects for the next six months decreased to 38 points from 40 points.

BUSINESS REPORT