Small business owners in South Africa are now more confident that the economy will be conducive for business growth in the next 12 months, a recent survey shows.
The average confidence levels reached 54% in the third quarter of 2013, which is a year-on-year increase of 5%, up from 49% during the same period in 2012, according to the 2013 third quarter Business Partners Limited SME Index (BPLSI).
However, South Africa still has a long way to go in terms of reaching the highest levels of 73% it once recorded in this aspect.
Nazeem Martin, MD of Business Partners Limited, said nevertheless that the improved outlook for economic conditions may be underscored by the significant reduction in business liquidations recorded in September by Statistics SA.
But despite this new development, SMEs owners are still less optimistic and have strong opinions and concerns about the country’s current labour laws.
Labour strikes have recently brought Africa’s largest economy to a standstill, denting SMEs’ already fragile growth and modest revenue.
Confidence in labour laws has however increased by 5%, the survey said, even though it appears that this level is still too low.
Is government doing enough to help SMEs? The survey asked respondents. There has been a 5% year-on-year increase in the number of ‘yes’ in this regard, but Martin said these levels of 31% in the third quarter remained low.
Asked about what form of assistance from government would benefit them most, 32% (up from 30% in the last quarter) of respondents indicated that direct funding would be most useful, while 22% (down from 25% in the last quarter) opted for government cutting red tape.
Nineteen percent (up from 17% in the last quarter) indicated that government providing better tax breaks would assist most.