Sacci warns of stormy outlook as trade slumps amid global turmoil
Economic Outlook
The latest SACCI Trade Conditions Survey report shows that trade conditions started off relatively weak early this year, improved into positive terrain by March and April, but then weakened again in May and June.
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TRADE conditions in South Africa have slipped back into negative territory after a brief recovery earlier this year, according to the latest SA Chamber of Commerce and Industry (Sacci) Trade Conditions Survey for May and June.
The report shows that trade conditions started off relatively weak early this year, improved into positive terrain by March and April, but then weakened again in May and June.
“The trade climate gradually weakened,” Sacci noted, reporting that while 56% of respondents experienced positive conditions in March, that figure dropped to 46% by June. “51% of the respondents indicated that trade conditions in June 2025 were better than in June 2024,” the report added, offering a glimmer of hope amid the downturn.
Despite the decline in sentiment, some economic indicators showed strength. Sacci pointed to new vehicle sales (+18% year on year), retail sales (+5%), inward overseas tourists (+3%), and merchandise import volumes (+3%) as evidence of certain positive developments. Notably, new vehicle sales were described as “a leading indicator” that suggested upward momentum in the first half of the year.
However, other key sectors told a different story. Merchandise export volumes declined by 10%, and the real value of building plans passed fell by 16% year on year. “There is disparity amongst various trade activities,” Sacci said.
Business optimism has also waned. In May, 69% of participants expected trade conditions to improve over the next six months, by June, that number had fallen to 62%. “The disappointing economic performance at present, and a globally uncertain economic and trade environment, contributed to a less favourable trade outlook,” the report stated.
Looking further ahead, Sacci warned that the trade outlook for the next six months had deteriorated. “Expected lower sales volumes, fewer new orders, and decreasing supplier deliveries” were among the concerns raised by respondents. The downward trend in expectations was linked to uncertainty and an anticipated limited performance by the local economy.
Consumer inflation remained low at 2.8% in May 2025, and producer inflation measured just 0.1%, offering some relief to households and businesses. The strengthening of the rand against the US dollar by about 1.5% in June also helped cushion fuel price increases.
However, Sacci sounded a note of caution: “Rising municipal tariffs and property tax may further distort inflationary expectations and thus disturb the prospects for lower interest rates.” It further said: “Real interest rates remain at an uncomfortable high level.”
Given South Africa’s open economy, global trade relations were expected to play a critical role in shaping domestic trade conditions. “Uncertainty of global trade prospects may become exceedingly perplexing in the near future,” Sacci cautioned.
Despite the rocky outlook, Sacci found that respondents do not anticipate drastic adjustments to staffing levels — now or in the coming six months. This suggests a degree of resilience within the business community.
In light of these findings, Sacci emphasised the need for ongoing efforts to boost local economic performance. “It therefore remains inevitable that the actions taken to enhance the local economic performance must be continued and enhanced,” the report stated.
As South Africa navigates a complex mix of global headwinds and domestic challenges, Sacci’s message is clear: vigilance and proactive policy will be essential to steer the country toward more stable trade waters.