. The South African Chamber of Commerce and Industry (SACCI) said that the Business Confidence Index (BCI) has increased well from May 2024 to February 2024 but noted a drop in confidence in March 2025.
Image: Picture: Henk Kruger/Independent Newspapers
In March South Africa's business environment reflected a sustained improvement in sentiment that began in June 2024, driven by stronger economic prospects.
The South African Chamber of Commerce and Industry (Sacci) Business Confidence Index (BCI), released on Wednesday, climbed from a low of 107.8 in May 2024, during the national elections, to a high of 125.8 in February 2025, before slightly easing to 123.5 in March 2025. This March 2025 figure still marked an 8.8-point improvement over March 2024, with the first-quarter 2025 BCI averaging 123.1, compared to 113.9 in the same period of 2024.
Sacci said, "The most positive short-term impacts on business sentiment in March were caused by increased tourism and exports, and lower inflation. Fewer imports, a weaker rand against the major trading and investment currencies, and declining share prices on the JSE imposed the largest negative month-to-month impact on business confidence."
The Sacci BCI also kept to the improved year-on-year levels in February and March 2025. "Increased inward tourist numbers, more new vehicles sold, and lower inflation were the main contributors to the enduring positive business sentiment compared to a year ago. Declining merchandise export volumes, real interest rates that remained relatively high, and manufacturing output which declined on a year ago weighed negatively on the business climate," it said.
Meanwhile, it noted that the new administration of the US entered the world’s economic and business fraternity in 2025 with a different and abrupt approach to restore and enhance America's domestic and global interests.
"Geopolitical tensions and the adherence to non-alignment based on international economic and business relations by individual countries could have profound economic and business implications. With South Africa registering economic growth of 0.6% in 2024 and the prospect of subdued real growth of between 1% and 1.5% in 2025, South Africa can ill afford to neglect global business opportunities to improve its growth potential and create jobs," it said.
Sacci noted, "Despite mounting global uncertainties, South African business and financial markets handled the challenging circumstances with relative calm."
Professor Raymond Parsons, an economist at the North-West University, said it is important that the business mood remains resilient amidst prevailing global and domestic uncertainties.
“However, as Sacci points out, business confidence still is vulnerable to the potential shocks that may still emerge from highly elevated levels of economic uncertainty. The SA Reserve Bank in its Monetary Policy Review, retained its forecast of 1.7% GDP growth for 2025, but has strongly emphasised the downside risks to this projection.”
He said it was essential for business confidence to remain positive enough to cope with the current risks and underpin a positive, if modest growth outcome this year.
Garth Rossiter, the chief risk officer at Lula, an SME services provider, said while the index paints a picture that reflects generally positive business sentiment, "there is certainly no room for complacency.
"Businesses, especially small businesses need to be given adequate support in which to thrive. Considering the tumultuous economic environment in which we currently find ourselves, there is no time to waste in not being focused on making businesses succeed.”
Rossiter said South African SMEs have faced immense pressure over the past 12 months with a 50% drop in turnover year-on-year. “The highest interest rates in more than 15 years have restricted consumers’ ability to spend, and this has had a massive impact on revenue across all industries. This has resulted in the South African economy showing almost no growth in 2024 - a stark reality that’s pushing many business owners to their limits, forcing them to make tough decisions daily just to keep the lights on.”
Efficient group chief economist Dawie Roodt said, “We have to expect that the BCI will deteriorate even further with concern about US President Trump tariffs on South Africa and the political issues in passing the 2025 Budget.”
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