Business confidence up: SACCI

Sacci said the business confidence index (BCI) increased by 0.2 index points in September to 89.2, after it improved by 1.1 index points in August 2014.

 

"Although it appears that waning business confidence has been checked, business confidence remains at an undesirably low level.

 

Such a low confidence level was last observed in early 2000," Sacci said in a statement.

 

"It is of concern that the poor business confidence performance is extended over such a long period -- an average of 91 for the Sacci BCI since December 2012."

 

The September 2014 BCI was 2.2 points below the September 2013 level of 91.4.

 

Sacci said the BCI averaged 90.3 in the first three-quarters of 2014 compared to the 91.4 in 2013.

 

Four of the seven physical activity sub-indices were positive month-on-month in September 2014, compared to three in August 2014, but none of the six financial sub-indices of the BCI were positive, said Sacci.

 

"More depressed levels of real economic activity -- the BCI covers seven such sub-indices indicative of the real economy -- than a year ago (year-on-year) reflect a significant handicap on the business climate," said Sacci.

 

"The lower year-on-year level of business confidence in September 2014 came largely from a more constrained financial environment than a year ago. All six financial sub-indices weighed negatively on the BCI."

 

Sacci said the disruptions of the real economy in the first half of 2014 led to broader consequences because it impacted on various financial indicators.

 

Sacci said it was concerned that the prospects for the South African economy were becoming more desperate as economic performance and the business mood were at a low ebb.

 

Needs, expectations and demands were not commensurate with output, supply and value added, Sacci said.

 

"A series of negative economic and socio-political developments are also putting the economic outlook under severe pressure."
Sacci said the Medium-Term Budget Policy Statement (MTBPS), to be presented by the finance minister on October 22, should respond to a weakening financial environment and address public finance issues.