The trading conditions in South Africa have forecast limited prospects for additional employment in the sector for the next six months, according to the South African Chamber of Commerce and Industry’s (Sacci) latest survey.
The Survey of Trade Conditions results for February 2024 showed that a rough trade environment currently on the cards for the country was to blame for the bleak prospects for employment.
However, the organisation said this was something that had begun deteriorating from October 2023.
Although there were minor improvements between January and February 2024, as many as 69% respondents in general reported to have experienced negative trade conditions.
While 79% of the participants viewed the February trade conditions as being worse than a year ago, Sacci said only 43% had positive expectations about future conditions.
Despite all elements of trade improving in February, the organisation said, however, it had to be considered that this came from the historic low base in January, with only 26% of respondents experiencing higher sale volumes in January which improved to a meagre 34%, citing increased sale volumes in February.
“A number of trade activities are touched by the cumbersome trade conditions, including logistical problems at harbours and rail transport, which have limited merchandise global trade, especially low-value-high-volume exports and which contributed to the more difficult trade conditions.”
The industry said it was believed that lower interest rates could help to stabilise retail trade activity and enhance household spending. However, issues such as electricity supply continued to affect trade conditions, most notably the additional cost to provide other sources of energy and stock losses of perishable goods.
The forecast over lack of employment opportunities, however, was a cause for concern given that South Africa’s unemployment rate during the first quarter of 2023 was recorded to be sitting at 32.9%, among the highest in the world.
Economist Dawie Roodt said although the country had resources such as gold going for it, the reality was that the country was experiencing a myriad challenges, including the lack of reliable electricity supply to run the mines, and the trains not running properly to get the ore to the harbour and out of it as well.
“We have a myriad issues in South Africa and most of these are mostly related to them being in charge of government-related things, and the reality is that state-owned entities are not working well and this has a really negative impact on the economy.”
Roodt said this year being an election year in particular was significantly important as the private sector would not make a move until after the election.
“They want to make sure whoever is going to be in charge is not going to promise silly things such as nationalise the mines and other grand promises political parties make. Every sector is waiting to see what happens and this is why this is the most important election since 1994.”
The Star