CEO CONFIDENCE INDEX
The Merchantec Capital CEO Confidence Index is a unique economic measure of the confidence of CEOs across the South African business landscape.
Gain insights into intended corporate hiring, capital and debt raising, Capex and future investments of South African companies and their leaders.
The questionnaire aggregates responses from over 1,000 CEOs of companies in both the listed and private environments. The Index therefore provides a comprehensive outlook of the South African economy going forward and is a leading indicator of the perceptions of business Executives.
The Merchantec Capital CEO Confidence Index was first released in Q2 2009 and is prepared on a quarterly basis.
Guest commentary from prominent CEOs including Mark Smith (FoneWorx Holdings Limited), Craig Venter (Allied Technologies Limited), Wayne Hook (Spar Group Limited) and Bernie Krone (EsorFranki Limited).
All eyes on the 2019 National Election as CEO’s dig deep to remain optimistic.
The Merchantec CEO Confidence Index recorded a 4% decrease in CEO confidence in Q4 of 2018 to a score of 49.0 which is just below the neutral score line of 50 points. The largest contributor to this decrease in confidence was the planned level of investment across all sectors. Basic resources, consumer services and technology have had marginal movement in confidence this quarter.
Next year’s national election is on the lips and minds of most CEO’s as we approach 2019 with significant uncertainty. CEO’s expect that the economy will turn the corner a few months after the election, provided that President Ramaphosa gets to serve his first official term in office. There is belief amongst CEO’s that The President, is taking bold steps to unbundle State Capture and that he is trying to weed out corruption. Whilst this plays out in the political arena, CEO’s have indicated that they are holding back on further capital investment and are considering re-structuring their operations to steer their business through political and economic unpredictability.
61.9% of CEO’s expressed a renewed positive sentiment to the appointment of Mr Tito Mboweni as Finance Minister, while 36.7% indicated that they do not believe that the appointment can provide the euphoria that we experienced when President Cyril Ramaphosa took the helm in Q1 of this year. The majority of CEO’s said that, they take comfort in the fact that Mr Mboweni has vast business experience and that he was the right choice given his track record. CEO’s appreciate his straight forward communication, honesty as well as his stance on SOE’s.
Basic Resources went up to a score of 55.00 points, a meagre 1.5% increase.
Consumer Goods decreased by 21.5%, moving to a score of 50.80. The decrease in overall confidence was primarily driven by a decrease in levels of planned investment and followed by economic conditions.
Consumer Services remained flat at 40.25.
Financials decreased by 12.3%, this was mainly attributed to economic conditions and company growth prospects.
Industrials increased by 23.1%, moving to a score of 48.90 from 39.72 in Q3. The increase in overall confidence was primarily driven by an increase in economic conditions and company growth.
Technology recorded a decrease by 2.3%, this was driven by dampened industry growth forecasts.
For a copy of the first quarter 2018 Merchantec CEO Confidence Index Report or for previous quarterly reports, please email Sabrina Manikkam at email@example.com or visit Merchantec CEO Confidence Index for past results.