CAPE TOWN: Business confidence in South Africa fell to its lowest in three decades in September, reflecting uncertainty about the outlook for Africa’s most industrialised economy, a survey showed on Wednesday. South African companies are struggling to stay afloat due to sluggish economic growth since a 2009 recession. The South African Chamber of Commerce and Industry’s (SACCI) monthly business index dipped to 90.3 in September from 92.9 in August, its worst showing since July 1985.
“The general overview of the demand side of the economy suggests a tight economic situation for all subjects of the economy, including consumers, investors and the public sector,” SACCI said. “The most pressing of the present situation is the lack of confidence by, notably, investors.” Investors have been nervous about Pretoria’s commitment to sound economic policies since Zuma changed finance ministers twice in less than a week in December, without explanation.
An ongoing police probe into current Finance Minister Pravin Gordhan has further hurt sentiment. “Business confidence is unlikely to show any signs of a recovery until the grave concerns surrounding Finance Minister Pravin Gordhan are put to bed,” said Paul Sirani, chief market analyst at Xtrade. “There could still be worse to come with fears rising over a possible credit downgrade as dark clouds continue to hover over South Africa.”
AngloGold Ashanti’s chairman, Sipho Pityana, on Wednesday became the latest business leader to call on Zuma to resign, labelling him the “sponsor in chief” of corruption. A manufacturing survey on Wednesday showed the private sector returned to growth for the first time in four months in September but was barely above the 50 mark dividing expansion from contraction.
