Businesses recovering slowly but recession is on the cards – RCCI
Increases in living expenses, interest rates and inflation have had a snowball effect on South Africans following the pandemic.
Businesses have done well to recover since Covid-19, but recession may still become a reality if things do not improve.
So said Randburg Chamber of Commerce & Industry (RCCI) CEO, Linda Blackbeard.
Speaking to Caxton Local Media, Blackbeard explained that even industries like food production and grocery stores recorded low profits since 2020 though they, while small businesses and the holiday, restaurant and hotel industries were much harder hit.
The former were essential and operated throughout the highest levels of lockdown, but the average consumer had to find ways to spend less.
“The small businesses that survived had to do things differently,” Blackbeard said.
“Whether it was change their product, or move their service online, those who adapted survived, and a few thrived. Some who were retrenched fell back to their established fields and professions and found a way to make an income with that.”
However, the economy has not recovered as many hoped it would.
“The fuel price increase, interest rate hike, inflation and other living cost expenses have created a snowball effect since the pandemic. People have not been able to pay increases and so our buying power is down and the rand strength is down.”
South African companies have not seen a good return on exports, and have had to pay more for imports.
“Right now luxury goods are only for the A+ income group. The interest rate hike has made buying homes look much harder and renting more appealing. If things do not improve we really could see a recession again.”
Blackbeard concluded that amid all this uncertainty and difficult economic times, the chamber wishes all women a fantastic and prosperous women’s month.
Related Article:
