The outlook is challenging amid quiet business conditions, with most companies battling higher interest rates and electricity supply interruptions. Load shedding is still taking place for between 10 and 12 hours per day and this is continuing to affect the economy, especially manufacturing industries. And as before, electricity public utility Eskom is struggling with maintenance and breakdowns at its power stations.
The country’s Central Bank increased the interest rate by 25 basis points in January and the next increase is expected to be between 25 and 50 basis points.
South Africa’s six-month ban on exports of copper, brass, gunmetal and ferrous scrap will be evaluated at the end of April to decide the way forward. Aluminium and stainless steel scrap can still be exported through the International Trade Administration Commission and permits will be granted if no objection is raised by local consumers; however, the export tax must be paid before shipping the material.
Inflation is currently at 6.9% and the growth forecast for South Africa this year has been cut from 1.1% to 0.3% owing to the ongoing load shedding. At the time of writing, the rand is trading at 18.45 to the US dollar.