South Africa’s economy is still volatile, with different sectors performing better at different times. The latest data shows some good news that construction activity was the best in 11 years in the fourth quarter of 2025, but the S&P Global PMI disappointed again with business activity declining sharply amid weak demand. According to theFNB/BER Civil Confidence Index, it gained nine points to reach 52in the fourth quarter of 2025 after an increase of two index points in the third quarter.
This marks the joint best level (along with the third quarter of 2016) in 11 years. The Index can vary between a maximum of 100, which indicates that all respondents were satisfied with prevailing business conditions, and a minimum of zero, indicating that all respondents were dissatisfied. A level of 50 indicates that the respondents are equally divided between satisfied and dissatisfied.
The current reading means that more than 50% of respondents were satisfied with prevailing business conditions, Siphamandla Mkhwanazi, senior economist at FNB, says. “Supporting the higher sentiment reading was a sharp improvement in activity growth. According to Statistics SA, the real value of construction works contracted by 3% year-on-year in the third quarter.
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The survey results point to a much less pronounced decline in activity in the fourth quarter off the back of renewable energy and mining projects.” In addition to more work, overall profitability was also higher. Therefore, the index measuring the growth in overall profitability registered its best level since the end of 2007. “It is a stretch to claim that profit margins are as generous as they were in the run-up to the 2010 FIFA World Cup final, when work was much more abundant, but it is clear that civil contractors are enjoying better margins.
This undoubtedly contributed to the better business mood,” Mkhwanazi says. Looking ahead, respondents expect activity to continue on this upward trajectory in the first quarter of 2026. However, order books, as proxied by the rating of new construction demand as a business constraint, were only slightly better compared to the third quarter.
Mkhwanazi says the higher sentiment was in step with better activity and overall profitability which suggests a potential rebound in the sector. “The forward-looking indicators, while mixed, suggest that the momentum will likely be maintained over the near-term. “The civil construction survey is the best non-official gauge for infrastructure investment.
On that score, the survey results are quite positive. However, the spread of activity seems to be clustered in renewable energy generation and mining, which is not bad – or even surprising – but does suggest that key reforms in other areas of the economy are still lacking,” Mkhwanazi pointed out.
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