South Africa kept interest rates unchanged on Thursday as Africa’s largest economy continues to grapple with the policy challenge of subdued growth set against inflationary pressures.
The decision by the central bank’s monetary policy committee to keep its repo rate at 5.5 per cent was expected as the volatile rand has recovered slightly from a disastrous beginning to the year when it tumbled to five year lows against the US dollar. Still, the MPC’s decision was a tight one, with a four-to-three split on the committee. Continue reading »
To hike or not to hike.
That will be the conundrum facing South Africa’s monetary policy committee as it began its first meeting of 2014 on Monday against a backdrop of emerging market turmoil and a tumbling currency. Continue reading »
With elections just months away, President Jacob Zuma and his ruling African National Congress party would have been wishing for some positive economic news as campaigning intensifies against a backdrop of stubbornly high unemployment and lacklustre growth.
But after a turbulent 12 months during which the pace of growth in Africa’s largest economy dipped to its slowest level since a 2009 recession, the first weeks of this year have offered little respite. Rather, more challenges lie ahead as domestic and external factors look set to combine to heap pressure on the country’s economic performance. Continue reading »
When members of South Africa’s National Union of Mineworkers agreed to a revised pay offer from the country’s main gold producers – bringing to a close a strike by tens of thousands of miners – struggling companies must have breathed a collective sigh of relief. Instead of the protracted strike many executives had feared, the industrial action lasted just a few days with virtually all workers returning to work by Sunday evening. Continue reading »
It has been a while since South African manufacturers have had much to cheer about as they have endured rising costs, increasing competition and the economic crisis in Europe, their main market. But as the rand has been trading at four-year lows against the dollar for much of the year, it seems they may finally be getting a lift. Continue reading »
When Jacob Zuma, South Africa’s president, got up to address parliament on Wednesday he did his bit to boost the spirits of a sombre nation, even if it was momentary uplift. He began by saying that Nelson Mandela was “responding better to treatment this morning” as the iconic former president spent his fifth day in hospital being treated for a recurring lung infection.
But then Zuma had to tackle other pressing problems facing Africa’s largest economy – the dire performance of its economy and the volatile nature of labour relations in the mining industry as companies prepare for crucial wage negotiations in coming weeks. Continue reading »
As South Africa’s Monetary Policy Committee has been meeting this week it will have been grappling with some familiar themes: a subdued global outlook and sluggish growth at home while juggling with the trade-off between boosting economic activity and countering inflationary pressures.
It’s a balancing act the MPC has battled with for more than a year, but now a new spanner has been thrown into the works: the sharp depreciation of the rand this year (not to mention any fallout from the Cyprus banking saga.) Continue reading »
When Cyril Ramaphosa was elected deputy president of the governing African National Congress last month his re-emergence into the top echelons of South Africa’s politics was widely welcomed.
Yet as Ramaphosa has settled into his new job, the old rifts between public and private sectors have rapidly resurfaced, laced with bellicose language. Have we enetered a new period of ANC/corporate mistrust? Continue reading »
Jacob Zuma, South Africa’s president, is known for his jovial demeanour. At African National Congress events, you can count on him to open and close his appearances by leading a boisterous round of singing, accompanied by hip-swinging dancing that belies his 70 years. When he’s delivering a speech, he’ll often break into a chuckle – even at his own expense as he can sometimes labour his way through prepared statements. Continue reading »
It didn’t take long for the ghosts of the violent labour unrest South Africa endured in 2012 to resurface.
The year is not yet two weeks old, but already pictures of police in riot gear dispersing hundreds of striking workers are being beamed across South African television channels. On Wednesday, more than 1,500 farm workers in the fruit growing Western Cape Province downed their tools to demand their minimum salary – a paltry R69 a day – is raised to R150. Continue reading »
As South Africa’s mining industry reels from weeks of wildcat strikes amid warnings that the unrest could lead to more job losses in an industry that provides employment for around 500,000 people, the last thing the country needed was a rise in unemployment.
But that’s what it got on Thursday when Statistics SA reported that joblessness in Africa’s largest economy had risen to 25.5 per cent in the third quarter, up from 24.9 per cent in the previous three months of the year. Continue reading »
Since a spate of wildcat strikes erupted across South Africa, the headlines have been damning and the image of Africa’s most developed economy has been severely tarnished. But, so far, the country’s equity and bond markets have managed to buck the trend of negativity.
In the weeks since the unrest broke out in the country’s rich platinum belt and spread to gold, the Johannesburg Stock Exchange has hit new highs in rand terms and is up by over 5 per cent since August 1. Continue reading »
To the frustration of the mining houses operating in South Africa – including many of the world’s largest – a debate about the nationalisation of the country’s mines has ebbed and flowed, but never quite died.
This is in spite of the fact that a number of top government officials, from President Jacob Zuma down, previously insisting it was not the policy of either the government or the governing African National Congress. Continue reading »
So, South Africa’s monetary policy makers have finally bitten the bullet and cut interest rates by 50 basis points, surprising the vast majority of analysts and highlighting concerns about the growth prospects in Africa’s largest economy.
For months now economists have been talking about the delicate balance act being performed by the South African Reserve Bank: weighing up inflationary pressures versus against a gloomy growth outlook. Continue reading »
South African pharmaceutical companies are on an expansion drive. In April, it was Aspen Pharmacare announcing that it was acquiring a portfolio of over-the-counter products from GlaxoSmithKline for R2.1bn ($271m), a move intended to help to boost its foray into Latin America.
This week, it was Adcock Ingram’s turn, splashing out 4.8bn rupees ($86m) on a drugs portfolio and a distribution network from India’s Cosme Farma. Continue reading »