Load shedding, steel strike hit SA business confidence

26 Nov, 2021 - 00:11 0 Views
Load shedding, steel strike hit SA business confidence Business confidence remained flat in the fourth quarter as new shocks such as load shedding and a steel sector strike by the National Union of Metal Workers of South Africa keep sentiment in the doldrums.

The Herald

Business confidence in South Africa  remained flat in the fourth quarter at 43 points, according to the RMB/BER Business Confidence Index.

After confidence levels took a knock from 50 to 43 in the third quarter – mainly due to the third wave of Covid-19 infections, the unrest in KwaZulu-Natal and Gauteng, as well as transport delays, shortages of inputs and insufficient stocks – there was no improvement in the fourth quarter.

This as new shocks such as load shedding and a steel sector strike by the National Union of Metal Workers of South Africa (Numsa), keep sentiment in the doldrums. “On top of that, existing supply chain disruptions and stock shortages have intensified,” the report read.

All sectors registered declines in confidence, except the building sector which lifted from 18 to 30.  “. . .  It’s unsure how long the improvement in overall building confidence will last; the non-residential property market continues to suffer from oversupply, while the boost from unrest-related re-building will likely prove temporary,” the report read.

Retail confidence levels dipped marginally from 56 to 52 points. Wholesale confidence dipped from 55 to 53. These are the only two sectors which registered confidence levels above the 50-neutral mark.

Manufacturing confidence declined from 41 to 38. “Sales improved noticeably after the third quarter disruptions, but a string of factors dampened confidence, ranging from a struggle to source enough crucial inputs timeously, production disruptions due to the Numsa strike and load-shedding, to escalating cost increases owing to higher prices of raw materials, increased transport costs and additional expenses related to load-shedding,” the report read.

New vehicle trade confidence dropped from 47 to 41 – new vehicle dealers suffered from insufficient stocks which affected the number of units sold.  fin24  

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