INFLATION GRIPS BUSINESS

Anxiety over inflation lingers amid a sense of optimism in corporate circles

The latest LMD-PEPPERCUBE Business Confidence Index (BCI) survey once again sees inflation dominating discussions in business circles. In December, 60 percent of respondents identified inflation as their primary concern, although this marked a fall of five points from the previous month.

Anxiety surrounding inflation is poised to continue, particularly with the value added tax (VAT) hike with effect from 1 January.

According to the poll conducted in the first week of December, high taxes persist as a serious challenge for businesses with 36 out of 100 survey participants expressing concern. However, this reflects a decrease of nine points from November.

The survey meanwhile highlights political interference as the third most pressing concern for nearly one in three respondents (30%).

Interest rates follow closely (cited by 26 of 100 participants) while concerns related to brain drain rank fifth (15%).

On a national scale, the economy remains the foremost worry among businesspeople with 62 percent saying so. On a somewhat positive note however, this reflects a 10 point drop from the preceding month. Politics and the political culture surged to No. 2 with 48 percent of poll respondents ticking this box, marking a substantial increase from November (23%) – in fact, the highest level of concern about politics in the last six months was 25 percent in October.

The cost of living dropped to third place, cited by 42 percent of respondents – this too represents a significant decrease of 17 percentage points from the previous month. And bribery and corruption ranks fourth at 19 percent and poverty (12%) takes fifth place.

– LMD