JOHANNESBURG, Aug. 10 (Xinhua) -- South Africa's business climate is returning to normal, with the business confidence index increasing, said the South African Chamber of Commerce and Industry (SACCI) Wednesday.
The SACCI monthly business confidence index rose to 110.3 in July from 108.5 in June.
"It appears that the July 2022 business confidence index number indicates that the business climate is gradually returning to normality. Increased merchandise export and import volumes and more new vehicles sold made positive contributions to the business climate in the short term in July 2022," said SACCI CEO Alan Mukoki.
Mukoki said inbound tourism recovered markedly while new vehicle sales increased despite extremely high fuel prices. There was some increase in credit given to the private sector despite higher debt servicing costs. The South African Reserve Bank, the country's central bank, last month increased the repo rate by 75 basis points.
"Higher inflation, a weaker and volatile rand exchange rate, and higher real interest rates weighed negatively on the business environment. The most negative year-on-year impacts were from the financial environment namely rising inflation, increased real financing costs, and a weaker and volatile rand," Mukoki said.
South Africa's economic climate is affected by distortions of global supply chains, commodity markets and rising inflation in the world, yet the country's economy showed some resilience despite these global challenges, he said. ■