S Africa: mining safety debate masks deeper problems

Andrew England

Andrew England is the FT's Southern Africa Bureau Chief, appointed in 2011. Prior to this he was Abu Dhabi Bureau Chief from 2008 and Middle East and North Africa correspondent from 2007. He joined the FT in 2004 as East Africa correspondent. Before joining the FT, he was East Africa correspondent for the Associated Press.

S Africa: mining safety debate masks deeper problems

May 14, 2012 4:50 pm by Andrew England

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Rarely, if ever, will a speech by Susan Shabangu, South Africa’s mineral resources minister, be complete without a reference to safety in the country’s mines.

It is a central theme of the ruling African National Congress, in part because of the dire treatment heaped on black mine workers during the decades of apartheid and discrimination. And last week, as she delivered her department’s budget statement to parliament, Shabangu described the sector’s commitment to health and safety as resembling a “curate’s egg – good in parts, which means lacking overall.” Continue reading »

Tags: labour laws, Lonmin, mining, South Africa mining Posted in Africa, South Africa | Permalink

Africa: IFC says PPP is the ABC

May 8, 2012 4:43 pm by Andrew England

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Africa’s huge lack of infrastructure is the inescapable topic when discussing the continent’s growth prospects. And it is easy to see why. Chronic power problems affect 30 African states; less than 5 per cent of African agricultural land is irrigated; only one in three Africans in rural areas has access to an all-season road and transport costs in sub-Saharan Africa are the highest in the world.

One way to tackle the shortfall is a rise in public private partnerships (PPPs) and an increased role from the private sector in building roads, railways and power stations. And Lars Thunell, chief executive of the International Finance Corporation, the investment arm of the World Bank, hopes the tide is beginning to turn. Continue reading »

Tags: Africa infrastructure, IFC, PPP, World Bank Posted in Africa | Permalink

The rise of intra-Africa FDI

May 4, 2012 4:08 pm by Andrew England

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This week it was the turn of FirstRand, one of South Africa’s “big four” banks, to expand beyond its domestic borders into other parts of Africa.

It is a move that South African entities have been pursuing with increasing vigour in recent years, from banks to retailers such as Shoprite, Woolworths and Massmart, which was taken over by Walmart, the US giant, last year. The trend is reflected in an Ernst & Young report on FDI projects on the continent, which saw a 27 per cent increase in 2011. Continue reading »

Tags: FDI, M&A Posted in Africa, South Africa | Permalink

Aspen Pharmacare extends EM reach

April 27, 2012 6:03 pm by Andrew England

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Think big business in South Africa and it’s likely that mining houses, banks or the brewer, SAB Miller, will be among the first to spring to mind.

Yet away from the more obvious groups, a South African pharmaceutical company, Aspen Pharmacare, has been cutting its own path in its domestic market and beyond, aggressively expanding its business from the Philippines to Brazil, largely through mergers and acquisitions. Continue reading »

Tags: Aspen, GSK, pharmaceuticals Posted in Africa, South Africa | Permalink

Nedbank shows the strain between S African business and government

April 11, 2012 3:19 pm by Andrew England

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It is not unusual in South Africa to hear of the strained relationship between the governing African National Congress and big business.

But in recent days an unusually ugly spat has broken out that has highlighted just how fraught those tensions are. The squabble began after Reuel Khoza, the chairman of Nedbank, one of SA’s “big four” banks, included a political firecracker in his message in the group’s 2011 annual report. Continue reading »

Tags: banking, Nedbank Posted in Africa, South Africa | Permalink

Mozambique: a fair share dilemma

March 16, 2012 10:01 am by Andrew England

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Mozambique is attracting the interest of foreign investors with its potentially huge coal and gas riches – which has sparked a debate in the country about whether the impoverished nation will get its fair share of the resource cake.

But does the government have the capacity and experience to negotiate with savvy multinationals? And should Mozambique be looking at the existing contracts with overseas companies? Continue reading »

Tags: coal, Cove Energy, oil & gas, resource nationalism, Sub-Saharan Africa Posted in Africa, Mozambique | Permalink

Walmart gets SA go-ahead at last

March 9, 2012 2:37 pm by Andrew England

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After a long, and at times bitter process, Walmart’s $2.4bn acquisition of South African retailer Massmart appears to be in the clear.

On Friday, a South African court dismissed appeals from three government departments and unions to have the deal – which will see the US giant take a 51 per cent stake in Massmart – re-examined. The one victory for those who instigated the court action was the ruling that 500 workers cut from Massmart just before the merger be rehired. Continue reading »

Tags: Africa gateway, FDI, M&A, massmart, retail, Walmart Posted in Africa, South Africa | Permalink

S African budget: cautious enough?

February 22, 2012 4:48 pm by Andrew England

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If the intention of Pravin Gordhan, South Africa’s finance minister, was reaffirm to the prudent fiscal credentials of his Treasury and send a message to wary ratings agencies, the initial reaction to his budget on Wednesday suggests he succeeded.

Bonds strengthened while he spoke. But they later retreated as investors judged the tough targets he had set might be hard to meet. The yield on the 2026 bond rose to 8.24 per cent from an earlier low of 8.18 per cent. The rand held steady at around 7.70 to the dollar. Continue reading »

Tags: economy, fiscal policy Posted in South Africa | Permalink

Implats: trouble at Rustenburg

February 17, 2012 4:13 pm by Andrew England

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To say it’s been a turbulent period for Impala Platinum (IMP:JNB), the world’s second largest platinum producer, would be stating the obvious.

Extreme price volatility for platinum, currency fluctuations, and controversial plans by the Zimbabwe government to have local investors take control of the country’s mines, including Impala’s Zimplats.

And on top of all this, the South African group has been dealing with an acrimonious month-long strike at its biggest mine at Rustenburg, – a sometimes-violent dispute that cost Implats around 60,000 ounces of production and R1.2bn in revenue. Some tough challenges for long-serving CEO David Brown who is leaving in June – and, in all likelihood for his successor. Continue reading »

Tags: mining, platinum Posted in Africa, Global, South Africa, Zimbabwe | Permalink

South Africa: shoppers’ surprise

February 15, 2012 5:50 pm by Andrew England

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Ahead of next week’s budget, Pravin Gordhan, South Africa’s finance minister, was handed some positive news that may help lift some of the gloom around the slow pace of his country’s economic growth.

Data released on Wednesday revealed that headline retail sales growth in Africa’s largest economy rose by an above-consensus 8.7 per cent in December, up from 7.2 per cent in November.

The economy is among the hardest hit in Africa by the eurozone crisis, as about a third of manufactured exports go to Europe. This year the International Monetary Fund cut its growth forecast to 2.5 per cent from 3.6 per cent. This compares poorly with 5.5 per cent for sub-Saharan Africa as a whole. Yet retail sales held up pretty well last year. Continue reading »

Tags: inflation, monetary policy, retail Posted in Africa, South Africa | Permalink

S Africa: clouds over miners’ gala

February 6, 2012 2:03 pm by Andrew England

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As executives and bankers gather in Cape Town to participate in the annual Mining Indaba, southern Africa’s premier conference for the industry, a good dose of the backroom chatter is likely to centre around the direction of policy in the host country.

For well over year the mining sector in South Africa – the world’s fifth-largest minerals producer by value – has been under a cloud of uncertainty as a debate has raged about the nationalisation of mines. The discussions have been spurred on by Julius Malema, the suspended youth leader of the ruling African National Congress party. Continue reading »

Tags: gold, mining, nationalisation Posted in Africa, South Africa | Permalink

S African stocks: record highs – if you’re a local investor

January 25, 2012 5:33 pm by Andrew England

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There has been little to cheer about on world financial markets in recent months but in the past week South African equities have been able to claim an all-time record.

The Johannesburg Stock Exchange, by far Africa’s largest, has hit record highs with its benchmark All-Share Index closing on Monday at 33,940 points following six straight days on the way up. But there’s a snag: that’s only in local currency terms. For international investors it’s a different story, with the rand’s weakness cancelling most of the gain – though the market is still up, just. Continue reading »

Tags: consumption, currencies, equities Posted in Africa, South Africa | Permalink

Fitch puts South Africa on negative

January 13, 2012 6:25 pm by Andrew England

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As speculation swirled about the latest action to be taken by rating agencies in the crisis-hit eurozone, South Africa had its own dose of bad news.

Fitch on Friday affirmed the country’s long term foreign and local currency credit ratings at BBB+ and A, respectively, but revised its outlook on Africa’s largest economy to negative from stable. Continue reading »

Tags: credit ratings Posted in Africa, South Africa | Permalink

Eskom: avoiding black-outs

January 10, 2012 5:31 pm by Andrew England

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The warning from Eskom, South Africa’s state utility, didn’t beat about the bush.

All customers, big and small, were requested to switch off all non-essential electrical equipment, including air-conditioning, geysers and swimming pool pumps, during the evening peak hours to ensure Eskom can keep the lights on.

Tags: electricity Posted in Africa, South Africa | Permalink

South Africa: more strikes in 2012

December 20, 2011 7:28 pm by Andrew England

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photo: Bloomberg

If corporate South Africa was hoping for some festive cheer from its country’s powerful unions after enduring a wave of painful strikes this year, it should think again.

In a defiant speech to mark the end of 2011, Zwelinzima Vavi (pictured), general secretary of the Congress of South African Trade Unions (Cosatu), threatened two separate campaigns of industrial action for early next year. Continue reading »

Tags: labour disputes Posted in Africa, South Africa | Permalink

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