Business confidence rocked by economy

Zweli Mokgata

Zweli Mokgata

Business confidence plummeted by the biggest margin in almost 20 years last month, as an onslaught of economic disasters recently hit South Africa.

The South African Chamber of Commerce and Industry's Business Confidence Index (BCI) dropped by 5,7 index points to 84,2 in October - creating lower expectations about the country's economic growth.

This was the largest month-on-month decline since July 1990 when the BCI declined by 7,9 points. It fell to levels that prevailed before interest rates started to fall in June 2003.

Richard Downing, SACCI economist, said: "The key contributor to the current state of business confidence is the performance of the global economy and the consequences experienced in South African financial markets."

According to the national treasury South Africa's economic growth will slow to as little as three percent but the economists think it could be lower.