Economic activity in the iLembe district is better than businesses perceive it to be, but reasonable concerns continue to prompt a pessimistic outlook.

This was revealed as part of iLembe Chamber of Commerce’s biannual business confidence index (iBCI) released this week in conjunction with Enterprise iLembe.
The report tracks commercial activity while a survey tests the confidence of businesses within the iLembe district, which includes the KwaDukuza, Mandeni, Ndwedwe and Maphumulo municipalities.

Scores of above 50 index points are referred to as positive, while anything lower is negative.

Overall, the district’s economic activity index of 55.5 was good for the sixth consecutive positive return, although it had dropped 0.4 points.

The business confidence mark remained in negative territory at 47.2 points, which is 4.7 points higher than the same period the year prior.

Pressing issues

Eskom’s unprecedented year of loadshedding in 2023, which saw 332 days of outages, was unsurprisingly cited as a factor in the negative outlook.

Congestion at the Durban port, which has since been resolved, also contributed, while beach closures in eThekwini drove poor tourism sentiment.

Decaying infrastructure, inadequate security measures and delays in building approvals all played their role too.

There were some positives however, including the reopening of the M4 Tongaat River bridge and the announcement of the Club Med Tinley development.

Individual sector performance

Manufacturing, Assembly remains iLembe’s least confident sector at 34.9 points, despite an increase of 6.5 year-on-year.

The sector has seen a decrease in demand from retailers in light of cost-of-living challenges, while power issues have had a major impact.

Tourism, Catering, Accommodation, Property Management saw the biggest drop of 8.6 points to become the second least confident sector surveyed at 37.9 index points.

A slump in the perception of KwaZulu-Natal as a tourism destination has hurt the industry, while multiple businesses raised the delay in receiving business and liquor licenses as an issue for the first time.

Construction, Property Development, Property Sales (43.1 points, down 3.3) dropped as developers questioned unwieldy building control processes and the expectations around their contributions to infrastructure development.

Agriculture, Forestry and Hunting saw an 8.8 point improvement to 45.8, but concerns remain over land invasions, Tongaat Hulett and delays in export processes.

Overall the hybrid index, which combines economic activity and sentiment, registered at 51.3 points, which is only the third such positive mark since the iCBI began in 2015.

The report called for a concerted efforted to address the basics for further improvements to take hold.

“These include a responsive and effective public sector, the refurbishment of ageing infrastructure, enhanced law and by-law enforcement, curbing of community unrest, reining in the cost of doing business and removing red tape.

“These elements are all essential for local businesses to overcome the numerous structural and other modern economic challenges,” the report stated.

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