Business confidence among South Africa’s mid-market firms has deteriorated, according to a note released by Investec.

The note points to the latest Rand Merchant Bank/Bureau of Economic Research (RMB/BER) Business Confidence Index, which fell to 39 points in the third quarter of 2025 from 40 in the previous quarter. Sixty-one percent of firms surveyed reported dissatisfaction with current trading conditions, citing a difficult environment shaped by new US tariffs, the loss of African Growth and Opportunity Act (AGOA) trade benefits, and load-shedding.

Investec highlights that recent US tariff increases on South Africa could reduce South Africa’s GDP growth by 0.1 percentage points, with overall growth projected at 0.9% in 2025 and 1.5% in 2026. Sectors such as manufacturing and retail are feeling the pinch from lower demand and rising input costs, while municipal service failures and regulatory red tape add further obstacles.