The Deloitte Stability Index 2024

Key highlights

Africa FY23 results overview

• Africa DSI score declines: For the first time since the COVID-19 pandemic, reduced consumer spending and volatile input costs have led to a decrease in the overall Africa DSI score.
• South Africa and Nigeria: These two countries are driving the overall decline in the DSI score.

South Africa’s cost crunch

• Sector impacts: Retail and consumer products face challenges due to low consumer confidence, while mining, industrials, and construction are struggling with volatile costs.
• Profitability disparity: Companies with lower DSI scores are disproportionately affected by rising costs, leading to a decline in overall average profitability. This impact is not confined to specific sectors but may be influenced by factors such as the calibre of management and strength of board oversight.

Nigeria’s currency crisis

• Consumer spending: The naira's weakness is expected to contribute to a continued decline in consumer spending.
• FX Scenario impact: Consumer-facing sectors such as consumer products and retail, and high fixed cost industries that rely on debt funding such as oil & gas are particularly vulnerable.
• Increased imported inflation: Rising import costs have added to inflationary pressures, especially as import reliance has reached its highest level in a decade.