Stand by for an exchange rate of R5,50 to the dollar, buy South African shares, and keep away from mining stocks. Such was the advice of economists this week, who continued to grapple with the strengthening of the rand, unsure of what is causing it or how long the bull run may last.
South Africa’s best prospects for growing employment lies in sectors that export primary products to rapidly industrialising countries such as China and India, suggests a new labour market analysis by the Reserve Bank. These include food and coal, according to Labour Market Frontiers, published last week.
The arrival of a new premium beer and spirits distributor in South Africa may give SABMiller some grey hairs on the yuppie beer front. This week saw the launch of Brandhouse, a three-way joint venture between Diageo, Heineken and Namibian Breweries. The company will distribute premium beer brands including Heineken, Windhoek and Guinness, and whiskies Johnnie Walker, J&B and Bells.
Acting South African Airways (SAA) CEO Oyama Mabandla is considered the likely successor to André Viljoen, who resigned this week, widely believed to have done so under pressure. Oyama Mabandla is widely considered to have the professional and political clout to run the troubled airline.
Two local media groups, Naspers and Johnnic Communications (Johncom), are looking for growth beyond South Africa’s borders. Afrikaans media and pay TV behemoth Naspers is poised for good growth through acquisitions in the Far East and Africa. Its English-medium peer, Johncom, will need to bed down problem areas while keeping one eye on growth in Africa, says John Slettevold, media analyst at UBS Warburg.
<i>Iphepha elisematheni lesiZulu, Isolezwe, seliyatholakala kwi-Internet</i>. Yes, <i>Isolezwe (Eye of the Nation)</i>, the KwaZulu-Natal-based, Zulu-language daily newspaper, is now available on the web. This makes the site the first Zulu news website. This is a bold step for the cheeky, two-year-old, ground-breaking newspaper, founded by well-known journalist Cyril Madlala.
South Africa should manage its trade relations with China more effectively, rather than "naively pursuing" a free trade deal with the emerging-world economic giant, says Martyn Davies, a director of research and strategy at the research consultancy Emerging Markets Focus. Davies said the main barriers to entry were cultural, linguistic and political and that these would not disappear with a free-trade agreement.
Petrochemical giant Sasol is facing two important challenges to its pricing policy and general conduct, which are alleged to be strangling South Africa’s fertilizer and plastic industries. The outcome is seen by trade unions as critical to developing the growth and job-creating potential of the chemical sector.
Edcon, owner of Edgars stores, has rejected claims by trade union official that the company is increasing casualisation and exploiting workers. The claims were made to the <i>Mail & Guardian</i> by Simphiwe Nikiwe, national organiser of the South African Commercial, Catering and Allied Workers Union (Saccawu) in the wake of Edcon’s results two weeks ago.
Though feigning lack of interest, SABMiller, the world’s third-largest brewer, is preparing for its toughest battle in a decade. The company was recently asked how it would take on United States-owned Anheuser-Busch — makers of Budweiser and the brewer immediately above it in the global league — in what could be a bruising battle for Chinese brewer Harbin.
Oil prices will not trigger a global recession, even if they remain persistently above $40 a barrel level, foreign analysts said this week. The experts, at HSBC Securities’ London office, spoke as Brent Crude oil prices reached a 21-year high of $39 a barrel, sparking fears of a global recession and leading to calls for the Organisation of Petroleum Exporting Countries to increase supplies.
As the seven-year turnaround story of Edgars Consolidated Stores (Edcon) reached its climax this week, a key trade union warned of the dangers of growing casualisation and monopoly in the retail sector. Last week Edcon delivered market-defying results, which CEO Steve Ross made a point of noting "were underpinned by a sound economy".
South Africa’s iron and steel giant’s pricing practices will again come under fire when the Competition Tribunal hears complaints that it is hurting South African industry by charging international prices for its steel. Local steel users are battling the corporation over excessive pricing — but it is standing firm.
One of the most prominent contributors to South African economic policy over the past decade is a charismatic, mellifluous social activist with a passion for illuminating his craft: economics. Which is why, for the foreseeable future, life for this amiable 48-year-old is here, with his two children and his wife, the Afrikaner sculptor and mixed-media artist Karen Steyn. The <i>M&G</i> speaks to Iraj Abedian.
"The long-term solution is to achieve economic growth that keeps pace with the growth of the economically active population and to improve our education system." The <i>M&G</i> quizzes the man in the hot seat of the government’s job-creation efforts, Public Works chief operating officer Sean Phillips, about what lies ahead.
Eskom Enterprises, the Eskom subsidiary that undertakes a range of strategic investments, will not increase its stake in the second national operator (SNO) after preparing to write off R649-million in lost investments, acting CEO Duncan Mbonyana said last week at the unveiling of Eskom’s annual results.
"In a decade of flux South Africa made its mark on the international stage, partly owing to the world’s fascination with a newly liberated nation, along with its icon Nelson Mandela." South African music has charmed the world despite its rough edges, writes Thebe Mabanga.
Sivi Gounden, former director general in the Department of Public Enterprises, is likely to lead the Batemans group in the acquisition of an empowerment stake in Eskom when it becomes available in the next few years. The question of who is in the vanguard in contending for the stake gained renewed focus last week when Eskom released its results for the past year.
The Easter weekend’s church services offered an opportunity to reflect on how the Anglican Church in black townships has spent the past decade responding to competition from other denominations. The occasion is a reminder of the haemorrhage in membership that the Anglican Church has suffered to churches of charismatic worship.
Telkom’s recent announcement that it will slash its workforce by up to 3 300 workers (or 10%) appears to clash with an undertaking it made at the time of its listing in March last year. It follows staff reductions of about 10 000 workers between 2001 and this year.
The number of discouraged work-seekers rose by a million between March and September last year, while employers continued to pay higher wages to a falling number of employees, according to two surveys released by Statistics South Africa (Stats SA) last week. This indicates that unemployment in South Africa has at best remained static, at worst risen slightly.
It is hard to imagine a person in a greater state of elation than an artist who has just released an album. This is probably because, as this month’s hottest pop exponent, Thandiswa Mazwai puts it, it is a "labour of love". Mazwai is leaving kwaito behind her to explore her Xhosa genealogy, writes Thebe Mabanga.
The South African consumer’s sterling role in buffing up the country’s economic performance appears to be nearing its end, with appetite for credit showing a decline and implying a need for new sources of economic growth. This is according to the Reserve Bank’s Quarterly Bulletin released this week.
Former foreign affairs director general Sipho Pityana has joined the swelling ranks of "new-order" mandarins who have re-deployed their administrative experience from the government to the business sector. Pityana turns his public service experience to account by heading a new empowerment company.
Ownership presents the biggest and most contentious challenge to the information and communication technology (ICT) sector’s transformation. This was underscored this week by the release of the sector’s draft empowerment charter. Currently, only 10% of firms in the technology sector are black-owned.
Growth in middle-class disposable income has helped drive Metropolitan’s new business and strengthen its life insurance arm, said Preston Speckman, financial director of Metropolitan Holdings on Wednesday. Speckman this week unveiled a 51% growth in new life insurance business, to R103-million.
Patrice Motsepe will continue his ascent up the South African corporate ladder when a consortium he leads completes its purchase of a 10% stake in financial services giant Sanlam in a deal worth R2,2-billion. The details of the transaction were disclosed by Sanlam last Thursday.
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/ 27 February 2004
As a company Anglo American is moving in the right direction, but it will need a "mega" merger if it is to make a quantum leap in growth, says Chris Law, a mining analyst at HSBC Securities in London. Describing the results as "very good", he said the London market was finally waking up to his long-held contention that Anglo "is a great group with great assets".
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/ 20 February 2004
Budget 2004 was "growth-friendly", without necessarily acting as a direct spur to economic growth, a key economic analyst said on Thursday. Iraj Abedian, chief economist of Standard Bank, observed that growth was ultimately driven by forces like the global economy.
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/ 19 February 2004
"We have recovered R2-billion in the past two years from people in tax avoidance who raid the tax base to gain commercial advantage." In the week of the Budget Thebe Mabanga interviews Revenue Service chief Pravin Gordhan.
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/ 18 February 2004
South African Minister of Finance Trevor Manuel managed to keep the Budget deficit below 3% and squeeze in personal tax relief of R4-billion in a Budget that contained few surprises. Commentators expected the Budget deficit to exceed 3% of the gross domestic product, due to lower tax receipts and demands for increased social spending.
<li><a class=’standardtextsmall’ href="http://www.mg.co.za/Content/l3_fl2.asp?o=42167">Special Report: The Budget 2004</a>
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/ 17 February 2004
"I am a businessman, I was raised as one and will die one. I have no political ambitions." Thebe Mabanga quizzes Bheki Sibiya, the boss of newly-formed Business Unity South Africa (Busa), on the role of big business and the potential threats to unity.