SA business confidence jumps in Q2 (before Eskom unleashed Stage 4, that is)
Business confidence in South Africa showed a strong recovery in the second quarter of 2021.
It's at its highest levels in three years, according to the South African Chamber of Commerce and Industry’s (Sacci’s) monthly business confidence index (BCI).
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In May 2021 business confidence was recorded at 97, edging towards the 97.6 measured in March 2018.
Also out on Wednesday is the Rand Merchant Bank/Bureau of Economic Research (RMB/BER) Business Confidence Index.
It shows that business confidence increased by 15 points to 50 in the second quarter.
Bruce Whitfield interviews Siobhan Redford, economist at RMB.
While 50 is a nice high number, it's telling us that only about half of our respondents are satisfied with business conditions.Siobhan Redford, Economist - RMB
It's still not what one would call entirely rosy.Siobhan Redford, Economist - RMB
It's not, but the point is it is a huge improvement on the quarter before and it's the best it has been in three years?Bruce Whitfield, The Money Show host
Redford says it does reflect a "very impressive change" in the retail, wholesale and consumer-related sectors.
The new vehicle dealers, the wholesalers and retailers are all the sectors which have above-50 confidence...Siobhan Redford, Economist - RMB
...which is being buoyed by pent-up demand, very low interest rates, possibly also increased export demand and to a great extent some of the fiscal help that government has given during Covid-19.Siobhan Redford, Economist - RMB
So it's very much a consumer story which is positive, but the concern is how sustainable is it?Siobhan Redford, Economist - RMB
I think if our manufacturers and our retailers start seeing continued positive momentum, it possibly could become a little bit more sustainable....Siobhan Redford, Economist - RMB
However extended load shedding is going to be quite a big downside Redford notes.
She also discusses the crucial need for structural reform it the economy is really to bounce back.
Listen to the discussion in the audio below:
This article first appeared on CapeTalk : SA business confidence jumps in Q2 (before Eskom unleashed Stage 4, that is)
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