Johannesburg - Trade conditions continue to be strained and are now closely resembling the situation after the 2007/8 recession.
This is according to the South African Chamber of Commerce and Industry, which on Thursday released the results of its latest survey.
The release, which notes the seasonally adjusted composite Trade Activity Index (TAI) for January 2016 was 39 – similar to December 2015, comes on the same day that President Jacob Zuma will present his State of the Nation Address. Zuma faces several challenges, including revitalising an economy that is expected by the World Bank to grow at less than a percent this year.
Some analysts are hoping for clear policy shifts that will swing SA’s fortunes around. Earlier this week, Zuma met with captains of industry to discuss how the private sector could work closer with government.
This comes amid slumping confidence levels as SACCI noted earlier this month that conditions continue to remain muted for enterprises in the local economy.
The Business Confidence Index for January, released on February 4, shows a marginal improvement on December, coming in at 80 points. This is 0.4 points higher than December, but 9.3 points lower than a year ago. December's confidence level was at a 20-year low.
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Now the chamber says the TAI is 20 index points below January last year.
In a statement, SACCI CEO Alan Mukoki says the non-seasonally adjusted TAI, however, increased to 39 compared to 33 in December 2015.
The sales volumes sub-index improved to 42 in January 2016 from 30 in December 2015, while the new orders index increased from 26 to 35, he adds.
Supplier deliveries also improved to 32 from 29 in December 2015 while the inventories sub-index rose from 43 to 46 in January, notes Mukoki.
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However, the sales price sub-index declined by 2 points to 58 while the input prices sub-index rose to 74 – reflecting rising cost pressures in January 2016, says Mukoki.
“Trade expectations for the next six months remain uncertain and imply elusive expectations for the first half of 2016.”
IOL