BankservAfrica’s Economic Transaction Index (BETI) shows that annual growth slowed to only 0.2% last month, the electronic payments transaction company said on Wednesday.<\/p>\n
BankservAfrica’s regulated products CEO Brad Gillis said not even the pre-election spending of political parties could put momentum back into the economy.<\/p>\n
“The 0.2% year-on-year growth in April 2014 shows one of the smallest changes in economic activity over the last year,” he said.<\/p>\n
“On top of that, five of the last eight months indicated a month-on-month decline and only three, including April, showed an increase.”<\/p>\n
Chief economist for economists.co.za Mike Schussler said political parties only spent on a massive scale once every five years and some of this spend could show in the April figures.<\/p>\n
He said May or June could show more subdued economic activity due to the backlash of extended strikes.<\/p>\n
“In the past, the effect of a strike was mostly felt a month or two after the strike ended. On top of this, the economy is running the risk of negative growth as a result of high consumer debt levels and the inability of the economy to create new jobs.”<\/p>\n
Schussler said businesses struggled with the pace of economic change.<\/p>\n
On an international front, the South African economy would feel the effects of the recent lowering of growth figures for most countries by the Organisation for Economic Co-operation and Development.<\/p>\n
“It seems the whole economy is caught between strikes and slow international growth,” he said.<\/p>\n
Gillis said although the BETI took public holidays into consideration, they alone could not be used as an explanation because businesses no longer closed shop on these days.<\/p>\n
Also on Wednesday, the SA Chamber of Commerce and Industry (Sacci) reported that its business confidence index (BCI) declined\u00a0 by 0.1 index point in April.<\/p>\n
The BCI for April stood at 92.6 from 92.7 in March, it said in a statement.<\/p>\n
The April figure was 0.3 index points higher than its April 2013 level.<\/p>\n
Sacci found there were no signs that the general election affected the business psyche negatively.<\/p>\n
“However, the policy positions to be embraced will no doubt have an impact on business confidence,” it said.<\/p>\n
“Improvements in the BCI will reflect the domestic economy’s response to business-friendly policies by the newly-elected government, global market trends in relation to South Africa and the economic performance of advanced economies.”<\/p>\n
The chamber said prompt action by the new administation was required if permanent fault lines in the economy were to be averted.<\/p>\n
Meanwhile, the public holidays in April did not affect the business mood negatively, it said.<\/p>\n
“Five of the 13 sub-indices of the Sacci BCI had negative month-on-month impacts in April 2014.”<\/p>\n
Four of the seven physical economic activity sub-indices were negative on a month-on-month basis in April, two were positive, while one index was unchanged.<\/p>\n
“On an annual basis, seven of the BCI sub-indices were in negative territory in April 2014, a similar number to that of March 2014,” it said.<\/p>\n
South Africa\u2019s economy is stagnating: economist<\/strong><\/a><\/p>\n South African economy shows slow recovery<\/strong><\/a><\/p>\n