BUSINESS confidence as measured by the South African Chamber of Commerce and Industry (Sacci) improved for the second consecutive month in January as businesses become slightly more positive about conditions in the few months ahead.

The monthly business confidence index (BCI) rose one point to 94 from 93 in December, Sacci said on Thursday.

However, the January 2013 BCI was 3.1 points below the January 2012 reading. The average for 2012 was 94.1, down from 2011’s average of 100.4.

Sacci CEO Neren Rau said that with the index set at 100 in 2010, and the record high of 122.1 being achieved in December 2006, the index’s current level remained "far from desirable".

Manufacturing, construction and new vehicle sales contributed positively to business confidence on both a monthly and annual basis. Credit to the private sector and share prices also made positive contributions.

Municipal services and exports contributed negatively to the monthly movements in the index.

Mr Rau said business confidence carried forward into the beginning of this year despite a difficult period last month, when farm workers in parts of the Western Cape went on strike to demand higher wages.

The chamber called for "dramatic response measures" to restore trust and predictability to the business environment.

Business and government met on Sunday to establish common ground on tackling South Africa’s challenges of unemployment, poverty and inequality.

"By fostering fixed investment and an improved business climate, South Africa could benefit substantially from global investor and trade interest," he said.