It’s rarely a quiet day in South African mining. Last week there was the Mining Indaba conference, where the mood among many miners was one of caution; the mines minister has indicated that the controversial Mineral and Petroleum Resources Development Amendment Bill will pass within months; and negotiations over the crippling mining strikes have apparently ground to halt. Then there was the tragic death of at least 10 workers in two separate incidents at Harmony Gold (pictured).
So where next for the industry? Continue reading »
South Africa’s banks, notably its “big four” of FNB, Nedbank, Standard Bank and Absa, are some of Africa’s strongest financial institutions. But they aren’t immune to the main problems hurting the economy.
So what effect will Wednesday’s surprise interest rate hike have? Continue reading »
Gill Marcus, governor of the SARB
The basic narrative to South Africa’s rate rise is simple: EM currencies are under pressure, the rand especially; inflation is on the way; so time to hike.
But looking through the South African Reserve Bank’s statement, another concern stands out. Continue reading »
South Africa’s hike in its policy rate on Wednesday failed to impress traders who sold off the rand within 15 minutes of the hike announcement, driving it down by more than 3 per cent to 11.33 to the US dollar.
Speaking after the hike was announced, Ishitaa Sharma, a FX and rates strategist at Citibank said: “The markets are telling central banks they have to be a lot more consistent in their hawkishness.”
In advance of the South African rate hike, the rand had already weakened to 11.17 to the US dollar, a slide of 1.8 per cent. After the announcement, though, the rand fell further. Continue reading »
Big surprise. Despite every economist polled by Bloomberg predicting a hold, the SARB has hiked rates by 50 basis points to 5.5 per cent.
Reserve Bank governor Gill Marcus said that “The primary responsibility of the Bank is to keep inflation under control and ensure that inflation expectations remain well anchored. The depreciation experienced so far could improve our international competitiveness, provided that it is not eroded through higher wage and other input prices.”
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 »
Ah, the heady days of the rand at 10 to the dollar. Back only in June last year, that was the big psychological market barrier. Now 11 rand per dollar is the norm. Only a few weeks ago analysts had doubts that it would get that far – in November, Barclays suggested the rand could even strengthen back to 10.
Rip all that up. With the Argentine peso, Turkish lira and Russian rouble all posting big falls in recent days, the rand is just one of several emerging market currencies under pressure. So what are the implications of the rand at 11? Continue reading »
South Africa’s upstart miners’ trade union, Amcu, is starting 2014 with a bang.
Not content with becoming the recognised union over the older, more established National Union of Mineworkers (NUM), it is looking to pull off the impressive feat of organising strikes at South Africa’s three biggest platinum companies – Lonmin, Anglo American Platinum (Amplats), and Impala Platinum (Implats). That’s a combined 70,000 workers. And, more importantly, around two-thirds of the world’s platinum output. 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 »
To date, South Africa has done little to explore its offshore oil. Geological data is old and out of date, existing oilfields are ageing, and few new ones are being discovered. Even the Orange Basin, near Namibia, is believed to hold substantial reserves, but there has been little drilling since Shell acquired rights in 2009.
But technological innovations in deepwater drilling and seismic imaging, and general optimism following the discovery of hydrocarbons in the Karoo and along the southern African coastline, are prompting a growing number energy players to look again, despite the odds. Cairn India, Anadarko, Sunbird, Total, Sasol, ExxonMobil and Chevron are among those signing deals, bidding for exploration licenses and planning drilling activity this year. Continue reading »
Last year, South Africans had to get used to the rand at 10 to the dollar – in 2012, 8-9 was the norm.
Now, it looks like 11 to the dollar may become the new normal. The rand on Thursday hit a 5-year low to the dollar of over 10.8, having depreciated from around 10.5 at the end of December. Continue reading »
You tell a lot by a country’s electricity supply – in fact, some people prefer it to GDP when it comes to assessing China. So how is Africa doing?
A new Afrobarometer survey of 34 African countries – What people want from government – has named the best and worst countries in terms of power supply in Africa. Continue reading »
Africa is at the forefront of bringing financial services to the “unbanked” and new opportunities to seasoned investors. In Monday’s FT special report on Africa Banking and Finance, our correspondents examine the continent’s enormous potential and challenges, writes Justin Cash.
Africa editor Javier Blas looks at the growth of sharia-compliant investments across the continent, whilst Anousha Sakoui assesses bright new prospects for M&A activity. Continue reading »
By Kevin Lings of Stanlib
Nelson Mandela has had an unprecedented calming and positive influence on South Africa’s political, economic and social environment for almost 25 years. His life-long quest for peace and reconciliation disarmed even the staunchest opponent, allowing diverse groups of people to work together in a way that seemed unimaginable prior to the ending of apartheid. It is time for the political, business and labour leadership of South Africa to honour his legacy and move this country forward to the benefit of all. Continue reading »