It seems South Africa is out of woods if the recent business confidence index is of any indication. The Rand Merchant Bank (RMB)/Bureau for Economic Research (BER) Business Confidence Index (BCI), which is the barometer for measuring business activities in the country, rose to 26 in the fourth quarter of 2019. In the second quarter, BCI dropped from 28 to a steep low of 21 in the third quarter, the lowest since 20 years. The bank has collated feedback from 1,800 business executives during the first three weeks of November by interviewing them. However, despite the increase in the index in the fourth quarter, business confidence technically is negative.
The confidence vaulted riding on the back of growth in building, manufacturing and retail trade, three of the sectors, out of five, being picked up to calculate the index. The other two, motor trade and the wholesale trade did not have anything to cheer. While the growth in the former declined, the latter’s growth has been standstill. In the meantime, The South African Reserve bank, last week, predicted that the economy will grow 0.5 percent in 2019, 1.4 percent in 2020 and 1.7 percent in 2021.
