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Business confidence falls to almost two-year low

Sentiment among retailers and builders falls the most.

South African business confidence fell to the lowest level in almost two years in the first quarter, with more than two thirds of respondents dissatisfied with current conditions.

A gauge measuring sentiment declined to 28 in the first quarter from 31 in the final three months of 2018, FirstRand’s Rand Merchant Bank unit and the University of Stellenbosch’s Bureau for Economic Research said in a statement Wednesday. The median estimate of four economists in a Bloomberg survey was 32.

Key insights

Confidence in the retail industry is at the lowest since the end of 2013. Sentiment among retailers and builders fell the most, with the latter reflecting a dearth of new work, the survey showed. Confidence levels in four of the five sectors covered in the index fell.

President Cyril Ramaphosa’s rise to power boosted business confidence in early 2018 but sentiment has slumped as trading conditions remain depressed. While the his efforts to expose corruption, rebuild institutions and bolster investment will bear fruit in the longer term, “forceful, and in some instances, unpopular structural reforms must also form part of the mix,” said Ettienne le Roux, the chief economist at RMB.

“South Africa will not be able to shift to a lasting, higher growth and prosperity path without more short-term pain”, said Le Roux. “This time around, the country cannot rely on the global economy to counterbalance such internal adjustment costs, as global growth itself is now shifting to a lower gear.”

Africa’s most-industrialised economy expanded 0.8% in 2018 and is struggling to gain momentum as rolling blackouts threaten to damp prospects of a recovery. The index reflects the results of a survey of 1 700 businesspeople, with most responses received from February 13 to March 4, the bank said.

© 2019 Bloomberg L.P

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When you read business conference too low… read ANC strangling the economy

Though for obvious reasons business confidence may be low at the moment (9 lost years under Zuma) this business confidence index thing is highly subjective. The researchers ask e.g. 20 fund managers or 20 CEO’s for their view and if that person just had a bad day, the rating will be negative. What does the business confidence it actually mean?

It means in true Africa style the corrupt ANC and its sidekicks have managed to destroy a once flourishing country in order to join the workers paradises of Cuba , Venezuela and prime example Zimbabwe and Zambia and Angola and Mozambique etc …… at the bottom of the world pile to get real freedom and equality for all.:)

Well, as a business man, I can tell you my business confidence is low. So is the confidence of each and every business person who walks through my doors. So, yeah, my guess would be that this time around the survey is correct, even if perhaps flawed.

thumbs up Batman!

it means that it is going worse with the SA economy ( consumer ) than we actually realize….it is going so bad that the average family doesn’t even have money to go out for doughnuts ( Dunkin Donuts closed down for this very reason)

Has anyone been reprimanded for VBS, Eskom, State Capture?

We South Africans are now paying the price for the Zuma

Extract the new found Oil/Gas reserves near Mossel bay then we will see the economy make catch-up for the the past ten years.

I wonder if there is really gas down there and if there is will it be viable to extract……De Beers, off all companies, closed down Voorspoed Mine (with one of the richest diamond carrying ores ) just because it is not viable anymore?

How naive we where to believe CR would change everything…….we forgot that the real problem is and will remain the ANC!

The higher “expropriation” is driven as a political agenda, the more damage in business confidence. It’s VERY simple. (SA doesn’t have to search for complex solutions!)

It’s either darkest before dawn..

or it’s darkest because the sun has set for the SA economy and the lights have already been stolen..

Change would require a complete change in management.

I started my first business in 1999 just as the rand tanked and interest rates hit 27% and yet I survived and my business thrived through those tough times. Twenty years later and armed with way more experience and capital I would not even attempt to open a new business in this current environment.

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