Johannesburg - South African
manufacturers were less confident of domestic economic and business
conditions in the second quarter of this year‚ evidenced by an
increase in the number of those reporting poor to fragile business
confidence to 43% in the second quarter from 33% the quarter before.
The Manufacturing Circle released its
quarterly bulletin on Thursday‚ which showed that business
confidence in the manufacturing sector was fragile during the second
The second quarter's survey was
completed by 67 small‚ medium and large businesses as opposed to 49
that participated in the first quarter.
The proportion of surveyed firms
considering business conditions to be stable reached 33% in the
second quarter‚ down from 45% in the first quarter.
“The industry remains more vulnerable
than in the previous quarter‚” Iraj Abedian‚ economist and
chief executive of Pan African Investment and Research Services said.
The survey also indicated that the
sector was losing jobs momentum. Manufacturing shed 44 000 jobs in
the second quarter.
Just over 60% of surveyed firms
reported positive changes to their operating profits and cost of
capital. The recent interest rate reduction last month could further
improve manufacturers' cost of capital‚ according to Abedian.
“Their cost of capital has gone down
by 0.5%. That makes a difference‚” Abedian said.
Most surveyed firms' long-term outlook
for the next 24 months was for business confidence to likely remain
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