In the fourth quarter of 2022, South Africa’s business confidence took a hit due to weak local demand for vehicles, high borrowing costs, and pressure on consumer incomes. According to a report by REUTERS on November 21, the business confidence index fell to 31 points from 33 points in the previous three months. This was partly attributed to logistical challenges such as delays at harbours and dealing with potholes, as well as struggles to receive timely payments for delivered goods. Despite this, there was a 15-point jump in confidence among respondents in the retail sector, which has faced high operating costs due to power cuts. Non-durable retailers reported a decline in volumes due to price increases, while businesses struggled to pass on higher input costs to buyers. The decline in business confidence reflects underlying demand weakness and structural supply constraints around infrastructure and electricity.