Nairobi, Kenya - Africa's first monthly consumer confidence index (KIC Score) barely changed in June at +11. At this level, it means that the number of consumers who are optimistic is slightly superior that those who are pessimistic (a score of zero implies equal numbers in both camps). With a maximum of 100 and a minimum of -100, the current KIC level indicates that economic confidence continues to be barely positive in the urban centers polled. The sub-index for current economic condition metric remained negative at -10 up 4 points from May. However, consumers hope in the future with the sub-index for economic expectations dropped 2 points from May to reach +22.
The June readings of the KIC score range from -3 in South Africa to +36 in Ghana. The Ghana stock market was up 5.21% in June while the South Africa stock market was mostly flat (0.30%).
Nigerians most confident about national and city economy
Consumers in Nigeria are by far the most optimistic about economic conditions in the country and in the city closely followed by consumers in Accra. The perceived optimism is tempered by Mr Tony Elumelu, the Chairman, Tony Elumelu Foundation urging the Federal Government to quickly reposition the country’s economy to prevent disaster in the nearest future. In Ghana, China is committed to deeper trade and investment cooperation, as well as value addition to Ghana’s natural resources. Consumers in Tanzania and Kenya are the least optimistic about their respective countries and cities. This reflects the economic challenges in Kenya (inflation) and a regional war for east Africa supremacy between Kenya and Tanzania. Recently Kenya banned the importation of LPG and wheat from Tanzania. Tanzania responded furiously by banning exportation of unprocessed food including maize.
Personal finances is improving in Ivory Coast
Consumers in Accra are the most optimistic about their income prospects over the next six months, followed by those in Lagos. But as was seen last month, this optimism does not translate to expectations about meeting regular expenses, where Johannesburg residents lag far behind all other cities. Consumers in Accra are the most positive when asked whether they will be able to meet their regular expenses over the next six months. This disjuncture between views about the economy and personal finance may also reflect perceptions about inequality, where ordinary consumers do not believe that national or even regional economic gains flow proportionately to all residents. The divergence might also be a function of consumers’ more realistic and accurate assessment of their own personal finances relative to their assessment of the overall economy.
Residents in Ghana the most willing to spend
As in May, consumers across the urban centers surveyed are holding tight to their purses. The residents of Accra are more willing to make large purchase. The score for buying durables is in negative territory in four (4) out of the seven (7) urban centers polled. In most cities except Accra, residents are also likely to keep their spending on durables static in the next six months.
Getting a job is difficult across markets
As in May, consumers across the cities surveyed find it difficult to get a job in their area. The job prospect score is negative across markets: Lagos and Abuja ranking the lowest at -64 and Douala ranking the highest at +3.
KASI KIC Score’s 3264 sample survey of individuals in 7 urban centers in Africa was carried out between June 23 - July 5 of this year, and was conducted via our desktop survey capability.
Trudi Makhaya, economic advisor at KASI Insight said that "Several African countries are going through difficult times adjusting to the aftermath of the drop in commodities prices. In June, the IMF approved and extended loans to several countries in Africa including Cameroon, Ivory Coast, Tanzania and others. After a tough first half of the year, consumers in Ivory Coast are feeling a little bit upbeat. It will be interesting to see if the trend persists over the next couple of months."
Note: Tanzania was added to the KIC Score in February.
About the KIC Score
The KASI Insight Consumer Confidence Score (KIC SCORE) is a composite index compiled from a seven-questions survey that runs monthly via our consumer polls in the countries covered. The data output is based on fresh, randomly selected representative sample of city dwellers aged 18-64.
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About KASI Insight
KASI Insight is Africa's most innovative research and advisory firm. We solve problems that present challenges for most firms doing business in Africa - lack of fresh local market data and the need for contextual insight and innovative research methods. We provide market research, actionable insights and data driven advice from over 10 countries in Africa.
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