HARARE-- Zimbabwe's business confidence index (BCI) slumped in the first quarter of this year to -14.4 from 5.8 in the previous one showing a lack of confidence in the operating environment which is synonymous with election periods, a business representative body says.
The BCI, as measured by the Confederation of Zimbabwe Industries (CZI), ranges from - 100 to 100, showing levels of pessimism when in the negative and optimism when the rating is positive. The index prepares managers to anticipate, position for and act on growth phases, booms or slowdown in performance.
A change in government last November saw a boost in confidence as the new administration announced its policies aimed at opening the country up for business.
On a year-on-year basis, business managers were optimistic that the environment would improve as the BCI stood at 20.9.
CZI president SifelaniJabangwe said Thursday that the slump in the quarterly index had been compounded by continued uncertainties regarding access to foreign currency. Since around September last year, the currency challenges have been taking a toll on industry and this really needs to be addressed, he said.
The decline can also be attributed to 2018 being an election year and as we draw closer to elections, weakened performance, low business confidence and reduced expectations in the economy also naturally moves with it.
he index is expected to remain low in the second quarter. Zimbabwe is due to hold presidential, legislative and local government elections within the next two months.
Jabangwe said the Purchasing Managers Index (PMI) stood at 50.8 points. The PMI measures five factors in business namely new orders, inventory levels, production, supplier deliveries and employment conditions with a rating above 50 indicating growth in the manufacturing sector.
Source: NAM NEWS NETWORK