Manufacturers pessimistic about future business conditions
bdlive.co.za - Feb 17th 2015, 13:16
A higher number of producers were more pessimistic about business conditions over the next year to two years in the fourth quarter of last year compared to a year earlier.
They cited regulatory hurdles, electricity shortages and a faltering global economy as among the reasons for their pessimism.
A Manufacturing Circle survey conducted among 64 firms also showed on Monday that the likelihood of strikes and no clarity over the government’s beneficiation strategy were also among the factors informing the downbeat outlook.
The Manufacturing Circle represents the majority of the country’s manufacturing firms.
The weak outlook translated into poor employment prospects in the sector. The survey showed that while mostly stable employment levels were expected over the current quarter (January-March), job cuts were envisaged over the next 12 months.
The Manufacturing Circle quarterly review showed that business conditions in the sector were mostly fragile or weak in the fourth quarter.
Sporadic electricity supply, low global commodity prices, subdued consumer demand, regulatory hurdles, and a volatile rand were factors that undermined business conditions over the period.
The review found that a significant share of manufactured goods was sold domestically rather than exported in the fourth quarter.
Despite the muted conditions, most respondents said they recorded increased sales supported by seasonal factors associated with higher festive season spending and extensive promotional campaigns.
Sluggish activity in the motor vehicle industry, weak mining sector performance, a decreased number of tenders awarded and increased competition from cheap imports and second-hand products affected domestic sales negatively.
Factors that positively affected export sales were a weak rand and an increased focus on the global market while those that counted against it included sluggish growth in the eurozone, elevated corruption in some African countries, and a weak Russian economy.
Manufacturers raised concerns over elevated input costs driven by above-inflation increases in electricity tariffs, labour costs, and municipal charges.
Iraj Abedian, who presented the review, said producers adopted measures to deal with high labour costs including reducing working hours, retrenchments, encouraging workers to go on early retirement, and automation.From DFM Publishers (Pty) Ltd
Manufacturing production shrinks for second month in July
11/09/2019 - 13:01
Manufacturing production recorded its second consecutive contraction in July, in line with analysts’ expectations.
Eskom: The largest threat to the stability of the SA economy
10/09/2019 - 09:45
On Tuesday 23 July, South African Finance Minister Tito Mboweni tabled a bill before the National Assembly which would see national state-owned power utility Eskom benefit from an allocation of R59 billion over the next three years.
Innovative leasing deals boost Kenya's office market
04/09/2019 - 09:25
A creative approach to leasing deals is helping innovative landlords offset the challenges of high vacancies in an overstocked Nairobi office market, according to Broll Property Intel’s latest Kenya Office Market Snapshot H1:2019 report.
No pain, no gain for SA economy
02/09/2019 - 16:22
Despite SA’s fiscal crisis — and the fact that the country has very little to show for the loose fiscal policy run over the past decade — there is a lobby (mainly on the Left) that thinks the best way to resolve SA’s growth and fiscal challenges is to inject further fiscal stimulus into the economy.
Producer inflation slows to lowest level in five months
02/09/2019 - 10:51
Producer inflation moderated to its lowest level in five months in July, due to lower fuel prices.