SA enterprise confidence dipped barely in March, however remained close to the highest stage in additional than a decade, the SA Chamber of Commerce and Business (SACCI) reported on Wednesday.
The chamber’s Enterprise Confidence Index eased to 123.5 factors within the month, down from 125.8 in February — the strongest stage since March 2012 — however nonetheless above the March 2024 studying of 114.7.
The survey was carried out earlier than the February funds was tabled and the following disputes amongst members of the federal government of nationwide unity (GNU) over proposed VAT will increase, and earlier than US President Donald Trump imposed sweeping tariffs on international locations, together with SA.
The most recent index studying alerts cautious optimism amongst enterprise homeowners regardless of unresolved fiscal tensions and rising international commerce uncertainties.
SACCI stated the improved sentiment had gained traction since mid-2024, as mirrored within the varied financial and monetary indicators that feed into the index.
The primary quarter common of 123.1 factors is properly above the 113.9 recorded throughout the identical interval in 2024, displaying sustained good points because the formation of the GNU after final yr’s elections.
Tourism, elevated exports and decrease inflation buoyed sentiment in March, whereas weaker imports and the rand’s depreciation towards main friends dragged the index down. Declines in JSE shares and manufacturing output additionally dampened month-on-month optimism.
SACCI flagged the impression of the delayed 2025/26 funds as a key concern. In February, finance minister Enoch Godongwana postponed his speech amid inside disagreements over the fiscal framework. A revised funds was tabled on March 12, however has but to be handed.
The chamber warned that extended indecision might “feed perceptions of political instability” and referred to as on the federal government to keep away from tax hikes that might additional pressure companies already navigating excessive prices and sluggish development. In keeping with the funds, two 0.5 proportion level VAT hikes are set for Might 2025 and April 2026.
“The federal government ought to discover choices for reducing down on the fats and wasteful expenditure in authorities,” SACCI stated.
“No proof has been offered to point out that sufficient has been executed, in a scientific and scientific method, to seek out financial savings with out essentially reducing down on crucial social companies and infrastructure expenditure. The federal government ought to focus extra on efficiencies and elevating the degrees of productiveness.”
Including to the uncertainty, the US administration’s extra protectionist commerce stance might threaten SA’s preferential commerce standing underneath the African Progress and Alternative Act (Agoa).
SACCI famous that the geopolitical local weather is shifting in direction of stricter scrutiny of commerce and funding alignment, which might threaten open economies comparable to SA’s.
Regardless of these challenges, monetary markets remained comparatively calm in March, SACCI stated. The rand’s efficiency was secure inside the rising market peer group, and inflation, at 3.2% in February, remained under the Reserve Financial institution’s midpoint goal.
Whereas the momentum from 2024’s political reset has not but waned, SACCI cautioned towards complacency. “International uncertainty, the potential for commerce disruption, tariff obstacles, and adapting to a altering international atmosphere have grow to be critically vital,” it stated.
Richard Downing, an impartial economist, stated sentiment was robust when the survey was carried out, however he doesn’t count on the following studying, due in June, to replicate the identical stage of optimism.
“Many elements and Trump’s tariff constructions haven’t but taken place in the actual financial system,” he stated.
“Should you have a look at how the inventory alternate was rattled, and the way the rand began buying and selling above sure ranges — that may have an effect on confidence ranges,” he stated, including that the funds disagreements and dangers surrounding the survival of the GNU would additionally have an effect on sentiment.
marxj@businesslive.co.za
