Monday 11 December 2017
(AFP (eng) 12/05/17)
South Africa's ailing economy grew by 2 percent in the third quarter, lifted by the agricultural sector which is recovering from a severe drought, official figures released on Tuesday showed. "The South African economy grew by 2.0 percent in the third quarter of 2017... down from a revised 2.8 percent in the second quarter," Statistics South Africa said in a statement. The agency said agriculture, mining and manufacturing were the "main drivers of the expansion" -- with increased corn and vegetable production. Improved gold and platinum production saw the key mining industry grow by 6.6 percent. Africa's most industrialised economy in the second quarter came out of its first recession in eight years, but economists...
(Reuters (Eng) 11/29/17)
LONDON (Reuters) - South Africa’s Public Investment Corporation (PIC) is planning to ask for two seats on the board of Lonmin by the end of 2017 and has suggested the platinum miner move its main listing to Johannesburg, its chief executive said. Lonmin, majority-owned by state-run PIC and listed in London since 1961, has been hobbled by persistently low platinum prices, rising costs and strikes, forcing it to tap investors three times in the last eight years. PIC, which manages $150 billion of government employee pensions, raised its stake in Lonmin in 2015 to 30 percent from 7 percent after a rights issue was undersubscribed. “We are a 30 percent shareholder, so we can ask for at least two board...
(Reuters (Eng) 11/29/17)
JOHANNESBURG (Reuters) - Brian Joffe’s South African investment firm Long4Life (L4LJ.J) has agreed to buy Chill Beverages for at least 452 million rand ($33 million) in cash and shares, Long4Life said on Tuesday. Joffe, former chief executive of the conglomerate Bidvest (BVTJ.J), listed Long4Life in April and has since made a string of acquisitions, including sporting goods retailer Holdsport and beauty chain Sorbet. Chill, whose brands include energy drink Score and tonic Fitch & Leedes, has a manufacturing plant in...
(Reuters (Eng) 11/27/17)
South Africa’s President Jacob Zuma has directed Finance Minister Malusi Gigaba to identify concrete measures to urgently address the country’s economic challenges, the president’s office said on Monday. President Jacob Zuma gestures as he addresses parliament in Cape Town, South Africa, November 2, 2017. REUTERS/Sumaya Hisham The directive comes after S&P Global Ratings on Friday downgraded the country’s local currency debt to sub-investment grade, while Moody’s place the sovereign on review for downgrade.
(Reuters 11/24/17)
Ratings firm Fitch kept both South Africa’s local and foreign currency credit ratings unchanged at BB+, one notch below investment grade, with a stable outlook, the agency said on Thursday. In April, Fitch downgraded South Africa’s credit rating to sub-investment grade after Zuma abruptly fired Pravin Gordhan as finance minister, saying it would likely result in a change in economic policy direction. “The affirmation reflects that while a number of developments point to a weaker fiscal outlook and consequent faster...
(Bloomberg 11/24/17)
The blow to Johannesburg-traded stocks from a potential downgrade of South Africa’s credit rating is likely to be hardest in banks and retailers, the sectors most vulnerable to local shocks. S&P Global Ratings and Moody’s Investors Service are scheduled to give their assessments later Friday. A cut in both companies’ ratings on South Africa’s local currency debt to below investment grade would trigger outflows from rand-denominated bonds and cause higher costs for local banks obliged to hold sovereign debt for...
(Reuters (Eng) 11/24/17)
South Africa’s failure to stabilise the country’s fiscal situation could see its credit rating downgraded deep into junk territory, the central bank said on Friday. The comment came just hours before two rating agencies were due to announce their decisions. South Africa’s economy is on the brink of losing its investment-grade ranking on local currency debt from Moody’s and S&P Global Ratings. Both currently rate it on their lowest investment grade rung of Baa3/BBB-minus. A lower rating means much higher...
(Reuters (Eng) 11/21/17)
CAPE TOWN (Reuters) - South Africa’s parliament will miss a December target to pass changes to mineral resource laws, seen as key for greater investor certainty, a senior parliamentary official said on Tuesday. In September, Mines Minister Mosebenzi Zwane told a mining conference in Australia that the new target date for promulgation of changes to the Mineral and Petroleum Resources Development Act (MPRDA) would be December. The MPRDA amendments were initially passed by parliament three years ago but were then...
(Reuters 11/17/17)
South Africa’s rand raced to a two-week high against the dollar on Friday as the greenback came under pressure after a report that investigators probing possible Russian interference in the U.S. election had subpoenaed President Donald Trump’s election campaign for documents. Bourse heavyweight Naspers helped push South African stocks higher. At 1511 GMT, the rand was trading at 14.0450 per dollar, 0.8 percent firmer than its close on Thursday. The currency had touched a session high of 13.9575, its firmest...
(Bloomberg 11/14/17)
South African banks are preparing for the worst when it comes to the threat of another downgrade of the country’s debt. “FirstRand anticipated the downgrades since 2015 and has been working on a number of proactive strategies to mitigate the impact,” said Andries du Toit, the treasurer at Johannesburg-based FirstRand Ltd., the country’s second-biggest bank by assets. The measures included adjusting credit origination, and boosting liquidity and capital buffers, he said. The credit ratings of the continent’s largest lenders such...
(Reuters (Eng) 11/14/17)
KIGALI (Reuters) - The global airline industry has $1.2 billion blocked in nine dollar-strapped African countries, the International Air Transport Association (IATA) said on Monday. The global commodities price crash that began in 2014 hit economies across Africa hard, particularly big resource exporters such as Angola and Nigeria. Low oil and mineral prices have reduced government revenue and caused chronic dollar shortages and immense pressure on local currencies. The fiscal slump has meant governments have not allowed foreign airlines to...
(Reuters (Eng) 11/08/17)
JOHANNESBURG (Reuters) - South Africa will launch an inquiry into weak tax collection by the revenue service after receiving the approval of President Jacob Zuma, Finance Minister Malusi Gigaba said on Tuesday. Gigaba shocked financial markets last month by flagging wider deficits and rising government debt in a closely watched budget speech, attributing the dismal forecasts to sluggish growth and low tax receipts. On Tuesday he told a news conference that Zuma had granted his request for an inquiry by a judge into the administration and governance of the South African Revenue Service (SARS). He added that the inquiry would be set up soon. “It is critical for government to determine the cause of the tax...
(Reuters (Eng) 11/08/17)
JOHANNESBURG (Reuters) - Finnish network equipment maker Nokia will trial its 5G technology in South Africa in collaboration with Vodacom Group, the firms said on Tuesday, as they seek to provide faster data delivery. Under a Memorandum of Understanding with Vodacom, Nokia will share its latest 5G innovations including among other things massive MIMO Adaptive Antennas, AirScale Radio Access and end-to-end Mobile Anyhaul transport networks to test how they can be used to meet changing demand in the country. “As...
(Bloomberg 10/31/17)
South Africa’s main government workers’ pension fund is seeking permission to invest more cash in international assets to protect against the impact of a possible downgrade of the country’s local-currency debt to junk status. The Government Employees Pension Fund is in talks with Finance Minister Malusi Gigaba about easing its investment criteria to include more foreign bonds and equities, Abel Sithole, principal executive officer, told reporters in Johannesburg on Tuesday. The GEPF currently has 1 percent of its 1.7 trillion rand ....
(Reuters (Eng) 10/31/17)
JOHANNESBURG (Reuters) - MTN sees a $4.2 billion claim by Turkcell in a South African court over a disputed Iranian mobile phone license as “opportunistic” and “baseless”, the company said on Tuesday after filing a defense plea. Turkcell first sued MTN in a U.S. court in 2012, alleging the company used bribery and wrongful influence to win a lucrative Iranian license that was originally awarded to Turkcell. It dropped the suit a year later after U.S. Supreme Court ruling in...
(Reuters (Eng) 10/31/17)
JOHANNESBURG (Reuters) - Barclays Africa (BGAJ.J) and Standard Bank (SBKJ.J) said on Monday they would stop working with McKinsey, a further blow to the global consultancy as it faces allegations of bribery for work done with friends of South African President Jacob Zuma. Privately-held McKinsey, the world’s largest management consultancy, has denied doing anything illegal but said this month that it was embarrassed by mistakes it made while working with South African state utility Eskom last year. McKinsey said it regretted working on a 1.6 billion rand ($113 million) contract at Eskom...
(Agence Ecofin 10/31/17)
During a café rencontre organized by Business Report, the American businessman Harold Doley Junior revealed that a consortium of international investors led by his organization pland to invest $1 billion in South Africa. “I am a firm believer that Africa can, and will, fulfil its potential for growth and create opportunities, especially for young people. It is with this in mind, and after many decades of involvement with Africa, that I am leading a group of notable international investors, who...
(Reuters (Eng) 10/31/17)
HARARE (Reuters) - Economic growth is expected to rise to 3.4 percent in sub-Saharan Africa next year from 2.6 percent in 2017, the IMF said in a report on Monday, but warned that rising debt and political risks in larger economies would weigh down future growth. Nigeria and South African are the biggest economies in Africa south of the Sahara, but both nations have been clouded by political uncertainty linked to the tenure of their leaders. The IMF said a...
(AFP (eng) 10/30/17)
South Africa's finance minister received some faint praise last week -- not for the economy's performance, but for admitting the country is in a dire position that is set to get worse. Malusi Gigaba delivered a mid-term budget that laid bare South Africa's struggle with slow growth, tax income shortfalls, rising debt and high unemployment. The daunting challenges recently caused business confidence to dip to the lowest level since the apartheid era -- reflecting wider fears that the achievements of...
(AFP (eng) 10/30/17)
Tunnels coursing through the bowels of the earth under the city of Johannesburg contain precious treasure -- copper cables that are being stripped out and smuggled as far away as Asia. As in many other parts of the world, copper cable theft is not new in South Africa, but lately it has reached an unprecedented scale. A recent brazen theft knocked out power and plunged the central business district of Johannesburg, the economic hub, into darkness, largely paralysing business for...

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