The spectre of a longer-than-expected struggle against a global pandemic still looms large in South Africa, the Bureau of Economic Research (BER) reports in its latest weekly roundup.
“The trade sector experienced another tough start to the new year,” it says.
“Much of the performance of the sector still largely reflects a Covid-19 narrative.
“In the first quarter of 2021, retailer and new vehicle trader confidence declined.”
Interestingly, wholesaler confidence remained largely unchanged despite a tough business environment and low sales volumes.
But although this says a lot for resilience in the face of adversity, significant risks lie ahead for the trade sector, the Bureau warns.
“With the prospect of a third wave in SA looming amid a very slow vaccine rollout, renewed lockdown restrictions to curb the spread of the virus will certainly harm the sector.”
The decline of confidence in the retail and new vehicle sectors was also recorded in manufacturing, a related Absa survey has found.
According to the bank, manufacturing business confidence declined to 25 index points in 2021Q1 (1st quarter).
“This comes after two consecutive increases brought the index to 31 points in 2020Q4.”
The Bureau says that at the current level, only a quarter of respondents were satisfied with prevailing business conditions.
