South Africa's Q1 business confidence eases to 49 points: RMB/BER

A worker inspects cars at BMW's manufacturing plant in Rosslyn, outside Pretoria, September 13, 2010. REUTERS/Siphiwe Sibeko·Reuters· (Reuters)

JOHANNESBURG (Reuters) - South Africa's quarterly business confidence index stumbled in the first quarter of 2015 due to the negative impact of power outages, which was slightly offset by lower fuel prices and inflation, a survey showed on Tuesday. The Rand Merchant Bank (RMB) survey, conducted by the Bureau for Economic Research (BER), fell to 49 points in Q1 from 51 in the previous three months. This reflected an improvement in retail confidence on the one hand, against a setback in the building and manufacturing sectors on the other. "A consumer theme of sorts is re-emerging to the benefit of certain retailers and wholesalers, as well as new-vehicle dealers," said Ettienne le Roux, chief economist at RMB. "This is just as well, as such service-oriented sectors are less energy intensive than manufacturing, which is a loser in the context of current electricity shortages and muted global trade that continues to hamper exports." Africa's most developed economy is struggling due to structural handicaps, including a nagging power crunch that has resulted from state power utility Eskom's inability to raise funds to upgrade its creaking generating infrastructure.

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