Business confidence in waiting
SACCI released the Business Confidence Index (BCI) for January 2019 at its offices in Illovo, Johannesburg.
The SACCI Business Confidence Index (BCI) remained virtually unchanged in January 2019 by measuring 95.1 compared to 95.2 in December 2018. Compared to January 2018, however, the BCI was 4.6 index points down from the exceptional level of 99.7 in January 2018. The level of January last year was to a large extend based on expectations for better business prospects following on new leadership of the ruling party.
The SACCI BCI continued to level out and move sluggishly during 2018 as there was little real progress in economic performance with recessionary conditions being experienced during two quarters of the year. Further attention was drawn to the extent of redress necessary to address the prevalence of maladministration and corrupt practices that impacted negatively on the economy and the business environment.
Nine of the thirteen sub-indices of the SACCI BCI were worse off in January 2019 than in January 2018. However, in general the assessment is that the economy and the business climate are better placed for improved performances than the sentimental euphoria of a year ago. The realism of challenges facing the economy has clearly emerged while the ability of the economy to adhere to expectations are more sobering.
The month-on-month movements of the BCI sub-indices remained irregular with January 2019 being no exception. Three of the seven real-activity sub-indices and two of the six financial sub-indices had positive month-on-month impacts on the BCI in January 2019. The main positive month-on-month effects were caused by increased real retail sales, the increased real value of building plans passed, and the stronger rand exchange rate. Higher share prices on the JSE also contributed positively to the BCI in January compared to December 2018. Merchandise import and export volumes and new vehicle sales had notable negative month-on-month effects on the BCI in January 2019.
Although the SACCI BCI appears to have stabilised, investor confidence remains the panacea to higher economic growth in 2019 and beyond. Dealing effectively with institutions and individuals involved with adverse business practices in the public domain becomes an important element for restoring confidence. Of equal importance is creating the attraction for investors when the Davos investment destination imperatives are implemented. Budget 2019/20 provides a timeously and ideal opportunity to pursue the right investor friendly climate.
For a full background to this month’s SACCI BCI see the economic commentary in the BCI report on www.sacci.org.za.
For more information, contact:
Alan Mukoki SACCI CEO 082 551 1159
Richard Downing SACCI Economist 082 822 5566
Read the BCI Report here:
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Author: Derrick Markotter
RCCI Webmaster Derrick runs a boutique web marketing agency, IdealMedia Marketing.