Latest news with #BusinessConfidenceIndex
IOL News
a day ago
- Business
- IOL News
Western Cape's economic growth surges despite national challenges
Western Cape Premier Alan Winde and Economic Development MEC Dr Ivan Meyer say strong agricultural growth and investor confidence continue to drive the province's economy forward. Image: Armand Hough / Independent Newspapers Despite national economic challenges, the Western Cape has once again emerged as South Africa's most resilient province, posting positive GDP growth and topping the country's Business Confidence Index (BCI) rankings for the second quarter of 2025. According to newly released figures, the province's BCI dipped only slightly from 52 to 51 but remains well above Gauteng's 37 and KwaZulu-Natal's 24, as well as the national BCI of 40. The index, which measures business sentiment based on key economic indicators such as exports and energy supply, signals continued confidence in the province's economic trajectory. Premier Alan Winde and Western Cape Minister of Agriculture, Economic Development and Tourism, Dr Ivan Meyer, credited the sustained optimism to the Western Cape's strong agricultural performance and strategic economic planning. 'Our commitment to doing everything we can to grow the economy and create jobs is showing in independently verified numbers,' said Winde. 'But we still have so much more to do. While I am pleased with these numbers, we will not relent in our commitment to ensure that more of our residents have a chance to get a job.' The province's GDP grew by 0.5% quarter-on-quarter and 0.9% year-on-year, driven largely by the agriculture, forestry, and fishing sector, which surged by 15.8%. This translated into an estimated R3.12 billion increase in the provincial GDP, underscoring agriculture's vital role in economic recovery. 'Strong business confidence is not an accident,' Winde said. 'This is the result of our hard work in ensuring the Western Cape is the easiest province to do business in. It is a vital indicator of how we are faring in growing our economy to create more jobs, despite a constrained fiscal environment.' Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ The Western Cape remains the only province with positive business sentiment, attributed in large part to its Growth for Jobs (G4J) strategy. Officials say the plan prioritises job creation through private sector investment, infrastructure development, and export growth. 'Notwithstanding significant headwinds, such as the impact of global trade uncertainty, business confidence in our province remains positive. If the private sector thrives, we all thrive, and more of our residents have the chance to get a job,' Winde said. The data affirms the Western Cape's status as a beacon of economic stability in South Africa's turbulent economic landscape. IOL News Get your news on the go, click here to join the IOL News WhatsApp channel.
The Citizen
3 days ago
- Business
- The Citizen
Business confidence tanks in second quarter due to pessimism about trading conditions
When business confidence is low, businesses are not investing, and the low level in the second quarter will definitely not help. Business confidence tanked in the second quarter of 2025 due to pessimism about trading conditions. The survey among business owners took place during May, when there was also a lot of tension between South Africa and the US. The RMB/BER Business Confidence Index (BCI) decreased by five points to 40 in the second quarter of 2025, after the recovery that started in the first half of 2024 stalled in the first quarter of 2025. This implies that only four out of ten business respondents in the most cyclically sensitive sectors of the economy were satisfied with prevailing business conditions, Isaah Mhlanga, chief economist at RMB, says. 'While remaining above the average of 2023 and 2024, confidence is now a touch below the long-term average level. The underlying survey results point to a loss of momentum in the South African economy.' He says some optimism returned to equity markets after a 90-day pause in the US reciprocal trade tariffs announced on Liberation Day, but the global trade uncertainty and continued local logistical issues were still flagged by respondents as factors negatively affecting their businesses. ALSO READ: No fireworks expected, but GDP figures are disappointing — economists Rand recovered and GNU looks more stable but did not boost business confidence The rand exchange rate also experienced a volatile quarter, weakening past R19.90/$ early in April but clawing its way back to below R18/$ during the survey period. On the local front, respondents would have known that the contentious proposed VAT hike was off the table, but many questionnaires were returned before the tabling of Budget 3.0 on 21 May. News around the government of national unity (GNU) and the DA's continued participation in it was mixed over the time period, with fears of an imminent collapse easing a little through May, Mahlanga says. Business confidence was driven by declines in four of the five sectors in the second quarter, partially offset by a sharp increase in wholesale trade confidence, leaving overall confidence lower. Mahlanga says this almost mirrored the previous quarter outcome, where declines in four of the five sectors were more than fully offset by a sharp increase in new vehicle dealer confidence, resulting in overall confidence rising. In addition to being the only sector to register an increase in confidence, wholesale traders also have the highest sentiment reading at 50 points. Non-consumer wholesale traders fared well during the quarter, but consumer goods traders suffered and faced a sharp drop in sales. 'This is a worrying sign for consumer demand in the second half of the year, despite supportive macroeconomic factors such as low inflation, interest rate cuts and two-pot pension fund payouts.' ALSO READ: Surprise that all MPC members were in favour of repo rate cut Business confidence in retail trade sector also deteriorated For now, business conditions in the retail trade sector remained largely in line with the long-term average, although confidence deteriorated by 8 points to 42. Motor trade dealers saw a slightly bigger drop of 10 points, but also to 42 in the second quarter. Generally, Mahlanga says, respondents in the sector remained fairly upbeat about business conditions and sales volumes, which underscores that the consumer likely still fared fairly well in the second quarter. He says the 25-basis-point reduction in the repo rate, which took place after the survey period but was largely expected, could provide some further support, although this is countered by an increased personal tax burden. However, building contractors in the residential sector have not yet benefited from past rate cuts, and the cut last week may also be insufficient to turn their fortunes around. According to the second quarter results, activity came under further pressure, which weighed on sentiment. Non-residential contractors, on the other hand, fared better, but overall confidence among all building contractors decreased by 10 points to an almost three-year low of 35 points. ALSO READ: Manufacturing PMI falls to lowest level since April 2020 — bad news for GDP Business confidence in manufacturing sector remains very low Despite a notable deterioration in business conditions, confidence in the manufacturing sector remained virtually unchanged at a low 33 points, with manufacturers reporting a decline in domestic and export demand, leading to a drop in production. Many of the constraint indicators, including the general political climate, increased in the second quarter. Mahlanga says the warning lights from last quarter are certainly flickering brighter. 'The fact that confidence in four of the five sub-sectors declined and that [for two consecutive quarters] confidence in three of the five sub-sectors declined suggests that momentum in overall economic activity slowed down. 'During this period, just two sectors, wholesalers and new vehicle dealers, alternated to do the heavy lifting, but it was insufficient to lift confidence this quarter.' He says after the meagre 0.1% quarter-on-quarter gross domestic product (GDP) growth rate recorded in the first quarter, we cannot risk losing any further momentum. 'The reduction in the repo rate will provide some relief, but more is needed to reignite the spark in the South African economy. There is arguably more certainty on the local political front, with Budget 3.0 tabled and broad agreement among GNU partners to continue working together for now. 'The global environment will remain uncertain, but an easing of tension regarding diplomatic relations between the US and South Africa should support sentiment.' ALSO READ: This is where we would be if SA sustained an economic growth rate of 4.5% Experts agree we need structural economic reforms to boost business confidence Mahlanga says the core of South Africa's long-term economic recovery and resilience remains faster implementation of structural economic reforms. 'Without these reforms, the economy will remain vulnerable to global economic shocks and too slow to reduce the social ills that burden many with unemployment, poverty and inequality.' Jacques Nel, head for Africa Macro at Oxford Economics Africa, says the business confidence survey results are particularly concerning after the 1.7% drop in gross fixed capital formation in the first quarter. 'Businesses are not investing, and the uncertainty pervasive throughout the second quarter would have only dampened investment appetite further. Recent developments, including a more favourable monetary environment with benign inflation and lower interest rates and signs of improvement in US-SA relations, will boost confidence, but the risk is that this will be another lost quarter with economic momentum slowing down further.'
IOL News
3 days ago
- Business
- IOL News
South African business confidence dips in quarter two, signaling economic slowdown
The RMB/BER Business Confidence Index (BCI) fell by five points to 40 in the second quarter of 2025, reflecting pessimism about trading conditions amid a loss of economic momentum in South Africa . The decline follows a stalled recovery from the first half of 2024, with only 40% of respondents in cyclically sensitive sectors expressing satisfaction with business conditions. The data comes a day after Statistics SA said South Africa's gross domestic product increased by 0.1% in the first quarter of 2025, down from the increase of 0.4% in the fourth quarter of 2024. The survey, conducted from May 7 to May 26, 2025, highlighted global trade uncertainties, strained US-South Africa diplomatic relations, and local logistical challenges as key drags on sentiment. "The majority of the respondents are thus pessimistic about trading conditions. While remaining above the average of 2023 and 2024, confidence is now a touch below the long-term average level," it said. The rand's volatility, peaking past R19.90 to the dollar in April before recovering to below R18 to the dollar, added to the unease. While the scrapping of a proposed VAT hike provided some relief, mixed signals about the stability of the Government of National Unity and the Democratic Alliance's role in it further clouded the outlook, RMB said. The second quarter confidence print was driven by declines in four of the five sectors, partially offset by a sharp increase in wholesale trade confidence, leaving overall confidence lower. This almost mirrored the previous quarter outcome, where declines in four of the five sectors were more than fully offset by a sharp increase in new vehicle dealer confidence, resulting in overall confidence rising. Sectoral Performance Wholesale Trade : The only sector to report higher confidence, rising to 50 points. Non-consumer goods traders performed strongly, but consumer goods traders saw a sharp drop in sales, raising concerns about weakening consumer demand despite supportive factors like low inflation, interest rate cuts, and two-pot pension payouts. : The only sector to report higher confidence, rising to 50 points. Non-consumer goods traders performed strongly, but consumer goods traders saw a sharp drop in sales, raising concerns about weakening consumer demand despite supportive factors like low inflation, interest rate cuts, and two-pot pension payouts. Retail and Motor Trade : Both sectors saw confidence decline to 42 points, down 8 and 10 points, respectively. Retail and motor trade respondents remained relatively optimistic about sales volumes, supported by a 25-basis-point interest rate cut post-survey, though higher personal taxes may offset this boost. : Both sectors saw confidence decline to 42 points, down 8 and 10 points, respectively. Retail and motor trade respondents remained relatively optimistic about sales volumes, supported by a 25-basis-point interest rate cut post-survey, though higher personal taxes may offset this boost. Building Contractors : Confidence dropped 10 points to a near three-year low of 35. Residential contractors faced ongoing pressure despite prior rate cuts, while non-residential contractors performed better but could not prevent the overall decline. : Confidence dropped 10 points to a near three-year low of 35. Residential contractors faced ongoing pressure despite prior rate cuts, while non-residential contractors performed better but could not prevent the overall decline. Manufacturing: Confidence held steady at a low 33 points despite worsening conditions, with declines in domestic and export demand driving lower production. Political climate concerns also intensified. RMB said that last quarter's warning lights are "certainly flickering brighter". 'The fact that confidence in four of the five sub-sectors declined and that (for two consecutive quarters) confidence in three of the five sub-sectors declined suggests that momentum in overall economic activity slowed down. During this period, just two sectors–wholesalers and new vehicle dealers–alternated to do the heavy lifting, but it was insufficient to lift confidence this quarter,' it said. RMB said following the meagre 0.1% quarter on quarter GDP growth rate recorded in the first quarter of 2025, 'we cannot risk losing any further momentum." It said the reduction in the repo rate will provide some relief, but more is needed to reignite the spark in the South African economy. "There is arguably more certainty on the local political front, with Budget 3.0 tabled and broad agreement among GNU partners to continue working together for now. The global environment will remain uncertain, but an easing of tension regarding diplomatic relations between the US and South Africa would support sentiment," it said. Kristof Kruger, senior Fixed Income Trader at Prescient Securities, said the overall growth trajectory for 2025 remains subdued. South Africa's economic fundamentals continue to face several headwinds, including: Structural issues like energy shortages and high unemployment, like energy shortages and high unemployment, Global trade uncertainty and slow growth in key trading partners, and slow growth in key trading partners, Domestic policy challenges and a lack of political cohesion within the government. BUSINESS REPORT
Business Recorder
23-05-2025
- Business
- Business Recorder
OICCI presents BCI survey findings to Aurangzeb
ISLAMABAD: Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, met on Thursday at the Finance Division with a delegation from the Overseas Investors Chamber of Commerce and Industry (OICCI), led by President Yousaf Hussain. The meeting focused on the latest results of the OICCI's Business Confidence Index (BCI) Survey Wave 27, conducted nationwide during March and April 2025. The OICCI delegation presented the findings of the survey, which showed a marked improvement in overall business confidence across the country. The finance minister welcomed the upward trend in business sentiment, viewing it as a strong indicator that the country's economic trajectory is stabilising. He acknowledged the importance of maintaining a conducive environment for investment and emphasised the government's focus on supporting private sector growth and ensuring long-term macroeconomic resilience. The improvement in business confidence was seen as a reflection of broader reform efforts and collaborative engagement between the government and key economic actors. The OICCI president noted that business confidence had steadily improved over the past two years, with the latest surge highlighting the resilience of Pakistan's business sector and its optimism in tapping into future growth opportunities. The survey's findings also underscored increasing trust in the government's economic direction and reform measures. In response, the finance minister affirmed that the government would continue to take necessary actions to sustain this positive momentum. Policy consistency, transparency, and proactive engagement with stakeholders, including OICCI members, were identified as central elements of the government's approach to further strengthening investor confidence and economic stability. Copyright Business Recorder, 2025
Business Recorder
23-05-2025
- Business
- Business Recorder
Business trust improves significantly: OICCI's survey
ISLAMABAD: The Overseas Investors Chamber of Commerce and Industry (OICCI) on Thursday unveiled the results of its bi-annual Business Confidence Index (BCI) Survey – Wave 27, conducted across Pakistan in March and April 2025 which reflects significant improvement in overall business confidence, which improved substantially by 16 percentage points from negative 5 percent to positive 11 percent, compared to the previous wave conducted in October November 2024. However, the respondents have identified corruption, rupee devaluation, security threats/ street crimes, inflation, taxation and inconsistent government policies as threats, of which the share of inflation was 80 per cent, taxation 80 per cent, inconsistent government policies 67 per cent, rupee devaluation 66 per cent, corruption 54 per cent and security threats/ street crime 51 per cent. Talking to media OICCI President, Yousaf Hussain, Jason Avancena, Syed Akbar Ali and CE/ Secretary General, Abdul Aleem said the positive shift in sentiment across various sectors of the economy can largely be attributed to macroeconomic stability, declining inflation, and anticipated improvements in business conditions over the next six months. Pakistan's business confidence improves, but investment outlook dims: survey The manufacturing sector led the recovery in the overall business confidence, improving from negative three percent to positive 15 percent, followed by the retail/wholesale sectors, which rose from negative 18 percent in the previous Wave 26 to positive two percent in the latest survey. The Services sector maintained a steady outlook and jumped from two percent to 10 percent positive in Wave 27. 'The uptick in business confidence is a clear sign that our economic direction is on the right track. We are focused on creating a conducive environment for investment, supporting private sector growth, and ensuring long-term macroeconomic resilience. The improved sentiment among businesses is both encouraging and a validation of our collective efforts,' Yousaf Hussain quoted Finance Minister Muhammad Aurangzeb as saying during a meeting on Thursday. 'Over the past two years, overall business confidence has shown a notable improvement across the business community. This sharp recovery in the Business Confidence in the latest Wave 27 reflects the resilience of Pakistan's business sector and its readiness to seize emerging growth opportunities. It is heartening to see positive momentum across key sectors, which reflects improved sentiment and growing trust in the country's economic direction. To maintain this growing positivity in the business confidence' Yousaf Hussain said, adding 'there must be greater policy consistency, transparency and active engagement with the key stakeholders including OICCI members.' The BCI Wave 27 survey revealed increased optimism for the next six months, with 45 percent of the respondents expressing positive expectations. Key contributors to this positive outlook include economic growth, improved government policies, investment climate, and security situation. Despite the positive trend, 53 percent of the survey respondents reported a negative outlook on business conditions over the past six months, which is a substantial improvement from 66 percent negative sentiments in Wave 26. The key concerns indicated in the survey related to political stability, Rupee FX parity, Energy, and trade policies. The BCI of foreign investors, OICCI members randomly selected for the survey, showed a remarkable increase from positive six percent to 17 percent. This improvement is primarily attributed to better global business climate, an improved industry environment in Pakistan over the past six months, and expectations of increased capital investment in the coming six months. Abdul Aleem, Chief Executive/Secretary General OICCI, further highlighted, that the latest BCI Wave 27 results were better than anticipated, with positive expectations reflected across all major sectors. 'Employment prospects, expansion plans, and investment expectations demonstrated notable gains, particularly in the manufacturing and retail sectors.' 'New investment plans overall showed an improvement of 19 percent, but remained negative, which is an area of concern and needs to be addressed to further accelerate economic growth, energize Large Scale Manufacturing, trade and export,' he said. The OICCI BCI survey is conducted twice a year and reflects the views of major business stakeholders representing nearly 80 percent of Pakistan's GDP. The survey covers responses from various sectors, including manufacturing, services, and retail/wholesale, and assesses perceptions at regional, national, and business entity levels. The survey is conducted face to face throughout the major business centres of the country including Karachi, Lahore, Rawalpindi /Islamabad, Peshawar, Faisalabad etc. Copyright Business Recorder, 2025
