Business confidence in SA improved in July, with the SA Chamber of Commerce and Industry’s (Sacci) business confidence index (BCI) rising to 116.7, up from 113.2 in June. The latest reading is also 7.6 points higher than a year ago.
The average for the BCI in the first seven months of 2025 was 118.6 — 7.7 index points higher than the 110.9 for the corresponding period in 2024, suggesting that business sentiment remained broadly resilient despite persistent global and domestic risks.
The most encouraging short-term indicators were rising new vehicle sales, improved manufacturing output, firming global prices for gold and platinum and low inflation.
However, the data also pointed to underlying pressure in parts of the economy, including weaker import volumes, a decline in overseas tourist arrivals and a drop in the real value of building plans passed — all of which detracted from the overall sentiment.
Year on year, the business environment showed notable improvement supported by increased tourist arrivals, stronger new vehicle sales, easing inflation and firmer global prices for precious metals. The only significant drag on sentiment over the same period came from a decline in merchandise export volumes.
But Sacci cautioned the outlook faces mounting uncertainty, particularly in the light of escalating trade tension between SA and the US.
A proposed 30% general tariff on SA exports to the US, if implemented without negotiated exemptions, could have “unintended and austere consequences” for the domestic economy and longer-term business relations, the chamber warned.
“The type of exports and the sectors affected will also play a role in how it impacts economic growth and employment in SA,” Sacci said, adding that SA’s export-reliant economy — with about 32% of output dependent on foreign markets — is vulnerable to protectionist shifts in global trade policy.
The chamber flagged the need for urgent progress in revisiting the terms of the African Growth and Opportunity Act (Agoa) and other bilateral trade agreements.
Sacci also expressed concern about the SA Reserve Bank’s most recent growth projection of 0.9% for 2025, while the IMF projects 1%, reflecting subdued expectations amid trade-related headwinds.
The chamber urged policymakers to foster investor confidence through clarity, predictability and improved trade relations, warning that ongoing global and local uncertainty could weigh on sentiment in the months ahead.
“Though local business confidence has at least stabilised, it is important that it return to levels achieved earlier in the year as the newly formed government of national unity took shape,” the chamber said.
“The downside risks of potential or real higher trade tariffs to the economy, elevated uncertainty and geopolitical tensions that persist should make way by restoring confidence, predictability and the sustainability of economic performance.”
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