The South African Chamber of Commerce and Industry (Sacci) finds in its latest Trade Conditions Survey that the sector is facing increased pressure both in terms of current trade conditions, as well as anticipated trade conditions.

The seasonally adjusted Trade Activity Index declined to 31 in October, compared with 34 in September and 41 in August, while the Trade Expectations Index declined to 51 on a seasonally adjusted basis, from 58 in September and 56 in August.

Only 35% of respondents to the survey expressed positive sentiments for trade conditions over the next six months.

Further, more than half of respondents perceive the present trade conditions to be worse than those in October last year.

In October this year, 70% of respondents noted a decline in sales volumes and only 32% reported an increase in new orders.

Although input costs have shown signs of relief, subdued demand has restricted the escalation of sales prices.

Sacci anticipates that inflationary pressures will further ease with less stringent monetary policy.

The chamber also expects a more subdued Black Friday this year, with spending primarily focused on semi- and non-durable goods.

New-vehicle sales are under pressure, reflecting the complexities within the trade landscape as they perform slightly below 2022 levels.

Recent data indicates a negative trend in retail trade volumes, whereas foreign trade is exerting a positive influence on the economy, Sacci reports.

Nurturing foreign trade relations is of utmost importance at the moment, given the role it plays in the trade environment, it asserts.

On a more upbeat note, the growth in inbound tourism has had a positive impact on trade conditions, particularly within the small, medium-sized and microenterprise sector.

Respondents continue to face limitations on activity overall owing to constrained electricity supply. However, business resilience and adaptability have facilitated the exploration of alternative solutions.

Respondents have also expressed concerns about the poor state of the investment climate and the negative impact of being on the Financial Action Task Force grey list, which has undermined global perceptions of the country.

Instances of corruption and lawlessness have made even divestments a challenging endeavour.

The restricted trade conditions have adversely affected employment opportunities within the sector, with only 35% of respondents having hired new staff in October. Nevertheless, 45% of the respondents are considering the possibility of recruitment over the next six months.