SACCI PRESS RELEASE EMBARGO: 11:30 on Wednesday, 8 November 2017

Lingering Weak Business Climate SACCI today released the October 2017 SACCI Business Confidence Index (BCI) at its Offices in Rosebank, Johannesburg. After the SACCI BCI recovered by 3.4 index points to 93.0 in September 2017 from a low in August 2017, the BCI remained virtually unchanged at 92.9 in October 2017. The BCI registered nearly a similar reading in October 2017 than last year’s October BCI of 93.0. The average for the BCI in the first ten months of 2017 was 94.1 compared to 93.4 for the corresponding period of 2016, and 101.2 for the first ten months of 2015. The 2017 BCI average signifies a decline of 7.1 index points on the 2015 BCI average (which is before the replacement of the Finance Minister in December 2015). The SACCI Business Confidence Index (BCI) captures the prevailing business climate and what businesses are experiencing - the index is not based on business sentiment. Although the overall business climate was relatively unchanged between September and October 2017, the subdued economic performance continued to limit business opportunities. The SACCI BCI reflects the neutral sentiment in the market place. Positive month-on-month movements were evident in five of the thirteen sub-indices of the BCI in October 2017; five sub-indicators reflected negative moves and three did not change on the September reading. Higher merchandise import volumes made the largest positive impact on the October BCI followed by merchandise export volumes and increased real retail sales. The unchanged year-on-year BCI in October 2017 was the net result of seven sub-indices that improved on a year ago, four sub-indices that were worse off, and two that was unchanged. Lower inflation, improved new vehicle sales and the higher real value of building plans passed were the main movers causing a positive year-on-year impact on the BCI. It appears that South Africa is not currently in a position to take advantage of the improving global economic climate. SACCI, in its pre-Budget comments, urged the Minister of Finance to issue a policy statement that will restore confidence to the business environment and markets in general and in particular deal decisively and clearly with issues causing uncertainty. SACCI is convinced that the only appropriate avenue to generate growth is to nurture investors and the business environment in order to obtain a sustainable economic performance that generates the fiscal space, jobs, greater opportunity, inclusivity and wealth.

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 Richard Downing SACCI Economist

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