Ina Opperman

By Ina Opperman

Business Journalist


Business confidence increases in November, but not enough – SACCI

The increase in business confidence in November was not enough to say that the challenges business face have been overcome.


Business confidence increased in November, but when it is compared to November last year, the latest index suggests that the business climate and economic conditions did not provide the spark for increased confidence over the medium term.

According to the SACCI Business Confidence Index (BCI) for October 2023, business confidence was steady at 108.6 but saw a boost to 111.5 in November, using 2020 as the base year at 100. The BCI measures how financial and economic factors affect businesses over time.

The index inched up from an average of 109.0 in the first eleven months of 2022 to 109.4 for the same period in 2023. Unfortunately, SACCI says, there seems to be a lack of positive momentum in business confidence, with several lingering economic challenges that must still be resolved.

Between October and November 11 of the 14 sub-indices either showed positive changes (six) or remained virtually unchanged (five), while three sub-indices had a negative impact on business confidence during this period.

The index improved by 2.9 index points from October to November, with inward tourism and merchandise import volumes making the most positive contributions to business confidence in November.

ALSO READ: Trade conditions remained constrained in October

Business confidence index not really improved compared to 2022

However, compared to a year ago, the index only improved 0.9 index points compared to the 2.9 index point increase from October to November. SACCI says increased inward tourism, higher merchandise import volumes and lower core inflation were the standout positive contributors on a year-on-year basis.

On the down side, fewer new vehicle sales, the weaker and more volatile rand exchange rate and high real financing costs were the main factors that had a negative effect on business confidence in November compared to a year ago.

While the SACCI BCI recovered a few index points in November, SACCI says it is important to note that this does not necessarily mean that the business climate has become favourable or that upward momentum is fully restored.

“Much of the positive vibe came from civil society and businesses showing resilience and endurance. Swiftly addressing and resolving painful adjustments by the public sector could potentially restore upward momentum in business and more crucially inspire investor confidence for a higher economic growth rate.”

However, SACCI says, creating such a positive environment requires fostering appropriate international relations and ensuring supportive human and fixed capital stocks, especially in a dynamic economy like South Africa’s.

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