S. Africa's business confidence drops to 16-year low

South Africa's Business Confidence Index (BCI) dropped by 2.3 index points to 84.6 in June 2015 from 86.9 in May, according to data released on Tuesday.

This level was 5.1 points lower than in June 2014 and is the lowest level since the 83.9 of January 1999, a 16 year low, the South African Chamber of Commerce and Industry (SACCI) said.

The BCI is now more than 37 index points below the high level of 121.9 recorded in December 2006 with 2010 serving as base year of 100. The average of 88.8 for the BCI over the first six months of 2015 was the lowest since the first half of 1999 when the BCI measured 86.2.

The low confidence levels in South Africa are signalling a business climate that does not accept or appreciate private initiative of the individual or business seriously enough, SACCI said while releasing the data in Johannesburg.

The domestic and world economic climate remains uncertain with advanced economies and China, except for the US economy, failing to provide the necessary inducement, said SACCI.

Over-borrowed European member countries in general and methodologies to rearrange economies to return to sustainable growth and prudent financing, are the essence of the problem, according to the chamber.

This also reflects on countries heading for similar problems in the future and their prevention, the chamber added.

The Greek deliberations on austerity packages that broke down, contributed to uncertainties in dealing with the European Union, said the chamber.