Bucking the trend of pessimistic forecast of the South African business confidence index that is entering a deteriorating phase of no return, a new study by South African Chamber of Commerce revealed that the index increased in September from the lowest level since more than three decades. It says that the business confidence may continue to rise in the future as well with a caveat that the nation’s upcoming medium-term budget sets the stage for an economic recovery.
It may be noted that only the other day, the popular South African Chamber has reported about the poor business confidence in the country and lashed out at the government for their inaction. www.trandsnafrica.com has carried a story about the chamber’s findings. The reason for retracing such a strong statement within a few days’ time from its earlier stand is still not known. What is surprising is that while various other surveys are still maintaining a status quo on their outlook, the chamber’s survey now shows a rather improved state of the economy.
The South African Chamber of Commerce and Industry’s sentiment index climbed to 92.4 in September after falling to 89.1 the previous month. However, the median estimate of three economists conducted by Bloomberg revealed that the confidence index is at 89. As against these not so pessimistic picture, a survey undertaken by BankservAfrica revealed that latest Economic Transaction Index (BETI) for September 2019, showed how the country’s economy is taking a grim turn ahead of National Treasury’s mid-term budget policy statement (MTBPS). The index collates data on interbank payments in South Africa and has a significant correlation to the South African gross domestic product, suggesting that the country is facing an economic growth slowdown.
Many analysts point out that it could be a ploy of the business lobby to pressurize the government to come out with reforms to bail out the economy from its present morass, which they claim is mostly on account of the inclusive and anti-reform path being taken by the South African government.
