No Sparks flying from Mid-Term Budget - only Concerns
It was Tito Mboweni’s first real appearance, not an easy feat to step in front of Parliament and Public with a Mid-Term Budget that was almost solely concocted by his corrupt predecessor, the Butcher of Finance Nhlanhla Nene. He and his team had ample time to prepare and when Mboweni took over only weeks ago there was hardly any time to establish his own course. But would that have really been so much different from what was presented yesterday?
Any current Minister of Finance has very little to work with. The South African economy is treading water at one place with 0.7% anticipated GDP growth, a projection that we do not share. However, what we share are the facts: South Africa is in a recession and the inflation rate, officially qu…
What to expect from the upcoming Mid-Term Budget?
Spoiler Alert, the answer is “nothing”!
The upcoming Medium-Term Budget on 24 October 2018 will not go down in history as to be remembered, you can be sure of that! Newly appointed Minister of Finance and former Reserve Bank Governor, Tito Mboweni, has not had enough time to develop his own fiscal policy and beside that he is tasked to administer funds within such high fiscal as well as political constraints that there is virtually no room for a “big one”. The budget to be presented had long been done by the team under Nhlanhla Nene and he will more or less read out his predecessor#s findings.
But that does not mean we are not looking forward to Mboweni’s new office and especially him sharing his vision where the fiscal future of t…
Tito Mboweni succeeds Nhlanhla Nene and Rand Gains manifest
The rand held gains made ahead of President Cyril Ramaphosa’s announcement on Tuesday afternoon that former Reserve Bank Governor Tito Mboweni would be the new finance minister. Ramaphosa made the announcement from Tuynhys in Parliament. Mboweni is replacing Nhlanhla Nene with immediate effect.
Mboweni replaces Nene
The president said that Nene submitted his letter of resignation this morning. Last week Nene testified at the State Capture Inquiry that he had met with members of the Gupta family several times between 2009 and 2014. He had not previously acknowledged these meetings.
The rand was trading 0.67% stronger at R14.75 ahead of Ramaphosa’s announcement, having firmed on speculation that Mboweni …
Unemployment in Figures
Employment in SA’s non-agricultural formal sector dropped by 69 000 between March and June 2018, Statistics SA announced on Wednesday in its latest Quarterly Employment Statistics (QES) bulletin. The QES results are based on a sample survey conducted by Stats SA and include findings on employment in the non-agricultural formal sector. Stats SA reported that non-agricultural formal sector employment dropped from 9 817 000 in March 2018 to 9 748 000 in June 2018.
This was largely due to decreases in:
- community services (-67 000 or -2.5%);
- manufacturing (-13 000 or -1.1%);
- mining and quarrying (-2 000 or -0.4%) and
*transport (-2 000 or -0.4%).
Increases were reported in:
- trade (7 000 or 0.3%);
- business services (7…
180 degree turn by Gigaba: New Immigration Rules to be introduced
Minister of Home Affairs, Malusi Gigaba, surprised yesterday when announcing new visa rules to come, easing the access to South Africa for skilled workers, reverse some of the documentation required for travelling children and implementing negotiations with other countries for visa-free access to South Africa.
Has Playboy Gigaba turned from Saulus to Paulus? Surely not! His hand had to be forced by President Ramaphosa to contribute to the government’s efforts to stimulate economy and to stop boycotting Tourism and Businesses in need of critical skills. We all need to remember that it was Gigaba, who introduced insane conditions for travelling children and thereby costing the tourism sector billions of Rand in revenue, only justified b…
Heritage Day - Braai Day - Shaka Day
Heritage Day is one of the newly created South African public holidays. It is a day in which all are encouraged to celebrate their cultural traditions in the wider context of the great diversity of cultures, beliefs, and traditions that make up the nation of South Africa. The question of National or Cultural heritage is, however, not without its complications.
In a country of eleven different official languages and a turbulent recent political past, one is obliged to ask, for instance, whose heritage it is that South Africans are being called to celebrate. Another point of contention is that in a former settler colony such as South Africa, one person’s heritage is another person’s trauma. For example, whilst for some, the Great Trek …
Ramaphosa reveals Stimulus Plan to further Economic Growth
Earlier today, an excited and upbeat President Cyril Ramaphosa announced the government’s much-vaunted economic stimulus plan at the Union Buildings in Pretoria on Friday.
Here is what you need to know:
- There is no big number to the plan and it is difficult to determine exactly how much money the state will pump into the economy in an effort to jump-start growth. The plan rather centres around the reprioritisation of existing budgets.
- R50bn, however, is a one hard number mentioned the the president. This is the amount in the existing budget, presented to Parliament in February by then-finance minister Malusi Gigaba, which will be shifted around in this financial year.
- R400bn is another. That is the amount which will be …
Reserve Bank keeps Interest Rates and Ramaphosa to announce Stimulus Package
Exciting times ind the fiscal world surrounding South Africa#s technical recession. While SARB acted in the interest of preserving what there is in growth without deterring any investors, Ramaphosa has the more difficult job when addressing the nation this afternoon to announce the upcoming “Stimulus Package” to drive the economy out of its negative corner.
The SA Reserve Bank (“SARB”) announced yesterday afternoon that it will keep the repo rate unchanged at 6.5%, but the decision was apparently a close call. Governor Kanyago said that four members of the bank’s monetary policy committee (“MPC”) preferred an unchanged stance, while three members advocated for a 0.25% increase.
Ahead of the announcement, Into …
Inflation Rate down slightly, Rand braces for SARB decision
Stats SA announced this morning that annual consumer inflation for August was 4.9%, marginally lower than what most analysts had expected, but still 0.2% lower than in July 2018. It seems the current Rand weakness, which leads to price hikes for imported goods has not yet caught up with the consumer price levels, hence a last breather before the inflation rate will shift upwards again, but still a comfortable 1.1% from the target corridor of between 3% and 6%.
But is it is also good news for tomorrow’s meeting of the Monetary Policy Committee of the South African Reserve Bank (SARB) as it takes some pressure off any motivation to hike rates? Not really! The MPC needs to decide proactively rather than reactively and the Rand Exchange r…
New Expropriation Bill tabled in Parliament
A new expropriation bill, set to be tabled in Parliament in the next two months, will set out a clear procedure for land expropriation without compensation and ensure it is an “administratively just process”, according to Deputy Minister of Public Works Jeremy Cronin. Earlier this month a draft expropriation law was withdrawn from Parliament to make way for a new bill that will set out a system of expropriation based on the ANC’s decision to amend the Constitution to allow for more muscular land reform. “It will be a process to prevent arbitrary deprivation,” says Cronin, who says the draft law will be light-touch legislation. The Department of Public Works is currently drafting the bill which will soon be complete.
This will be the…