(Bloomberg) -- An index tracking expected business conditions in six months time in South Africa’s manufacturing industry fell to the lowest level in more than three years over concerns that the country is at risk of record blackouts this winter because the state power company may not have enough supply to meet increased demand.

The gauge declined to 43.7 in May from 51 in April, Absa Group Ltd. said on Thursday. That’s the lowest reading since April 2020, when the country instituted one of Africa’s strictest lockdowns to curb the spread of coronavirus infections.

Eskom Holdings SOC Ltd. acting Chief Executive Officer Calib Cassim last month warned that the country faces a “difficult winter” as it heads into the cold months with 3,000 megawatts less capacity than last year. He said the utility envisages a worst-case scenario of having to cut 8,000 megawatts from the electricity grid — a process known locally as loadshedding — that would entail 16 hours of outages in a 32-hour cycle.

The purchasing managers’ index also fell to 49.2 in May from 49.8 a month earlier, signalling a deterioration in business conditions for four consecutive months, Absa said. 

“In all, the average index level of business activity in the first two months of the second quarter is below the first-quarter average,” the lender said “This suggests that the sector may once again detract from quarterly GDP growth after an expected expansion in the first quarter.”

The manufacturing sector accounts for about 14% of South Africa’s gross domestic product. 

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