South Africa's trade conditions remain tighter

JOHANNESBURG - Trade conditions in South Africa have been "tighter" since April this year and continue to provide "lackluster" performance, a new survey by South African Chamber of Commerce and Industry (SACCI) revealed on Wednesday.

SACCI Chief Executive Officer Neren Rau said that although the seasonally adjusted Trade Activity Index (TAI) recovered by five points to 50 in August, it remained below levels achieved earlier in the year.

"Trade conditions continue to be volatile but the activities surveyed are converging around the 50 index level as is notably the case with sales and new orders," he said.

"After reaching levels of around 60 in May 2012, the sales and new orders indices both registered 49 in August 2012. The inventories index increased from 45 to 48 in August 2012 with supplier deliveries improving from 42 in July to 50 in August 2012," he said.

According to the survey, sales and input prices were stable as the sales price index rose by one point to 58 in August and the input price index declined marginally to 65 from 66 in July.

"Although price pressures at present remain at bay, cost increases of especially administered prices are more than double that of the producer inflation rate. The weaker trade conditions make it difficult to cope with these rising costs. The latest year-on-year rise in the pump price of diesel was 17.6 percent," the SACCI said.

However, the chamber said employment conditions in the trade environment improved somewhat as the index increased from 45 to 48, although still in negative territory.