Market Update: Sacci survey shows South Africa’s trade conditions worsened in December – Full Analysis

South African Chamber of Commerce and Industry (Sacci) trade conditions survey for December released on Tuesday indicated that the trade climate deteriorated in December, with 60% of the respondents experiencing limited trade activities.

Sacci said the subdued domestic economic performance continues to weigh on overall trade conditions. “The tight conditions were confirmed by the latest SACCI Trade Conditions Surveys for November and December 2025. From improving marginally in November, the trade climate deteriorated in December, with 60% of the respondents experiencing limited trade activities.”

Sacci added that despite continuing difficult conditions, 45% of the respondents on average experienced a better trade climate in 2025 than the 39% of 2024. “According to the December 2025 Survey, 51% of the respondents noted that trade conditions improved in December 2024.”

Close to 70% of the respondents to the December 2025 Trade Survey expected trade conditions to improve over the next six months. “However, there appears to be a broadening gap between current new orders and expectations on sales volumes as it is noticeable that current constrained new orders do not match the higher sales expectations. Expectations on all elements of trade except for input prices contributed to the positive expectations on the trade environment six months from now,” Sacci said

Sacci added that the changes to global trade relations and the linkage effects are filtering through, and the necessary compliance to the changing global trade environment has become a matter of urgency. “It appears that actions to diverge South Africa’s foreign trade are a bigger challenge that involves quality, logistic bottlenecks, competitive prices, and consistency of supply to markets. The private sector is well suited by way of their associations in collaboration with the public sector (apart from trade agreements) to exploit global trade opportunities.”

Respondents expect price pressures to remain high, with expected sales prices (74%) and input costs (84%) to rise further. “Consumer inflation stayed low at 3.5% in November 2025, while producer inflation measured 1.8%. Electricity tariffs soared by 15.9% y/y in November. The lowering of the inflation target to about 3% will impose strict discipline on the application of price and tariff increases in the private and public sectors.”

Sacci added that credit to households rose by 3.5% y/y and by 11.4% y/y to business in November 2025. “This came in support of households and businesses experiencing financial stress and contributed to maintaining trade activity and increased retail sales volumes. Decreased trade activities were evident in the construction sector, merchandise export volumes, and new vehicle sales. Given the tight and varying trade conditions, respondents employed more temporary staff in December 2025, but with no additional employment expected in the next six months.”

Professor Raymond Parsons, an economist at North West University Business School, said any negative high-frequency data continues to remind us that the modest economic recovery must still be carefully nurtured. “The ‘green shoots’ in the economy must be encouraged as 2026 unfolds. Overall, various positive factors still outweighed negative ones as 2025 drew to a close. But the economy is not on cruise control.”

Parsons added that we must not lapse into another cycle of economic pessimism on one month’s data. “The implementation of growth-friendly policies must therefore be accelerated in 2026 to underpin the slow but uneven economic upturn.”

Professor Waldo Krugell, an economist at North-West University, said the results of the survey show that it is tough out there in the real economy, compared to the financial markets that are doing very well. “Respondents felt that things were slightly better in December 2025, compared to December 2024, but current new orders show that the domestic economy is just holding on, and pivoting in international markets takes time and is costly.”

Krugell added that it is interesting to note the optimism in sales expectations in six months. “It is not clear if that is based on hopes for faster economic growth spilling over from the resources sectors, or from optimism about consumer spending.”

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