SA Post Office is Finalising Loan Facility to raise Part of R3.7bn needed

SOUTH African Post Office (Sapo) CEO Mark Barnes is in the process of finalising a domestic syndicated loan facility to raise some of the R3.7bn for the company. The Post Office urgently needs the funds to stabilise its operations and start generating revenue, Telecommunications and Postal Services Minister Siyabonga Cwele said on Tuesday.

He told MPs during his speech on his budget vote in the National Assembly that his department would assist the company to raise the funding from the markets. The approximately R3.7bn the company needed "urgently" would be in addition to the R650m capital injection made by government recently.

Let Uber drive innovation in South African

A TIME magazine cover story last year spoke of the "sharing economy" that is disrupting industries and transforming the way we live as the likes of Uber and Airbnb drive new approaches to transport and accommodation.

The Uber logo is seen on a vehicle near Union Square in San Francisco, California. Picture: REUTERS/ROBERT GALBRAITH

Uber has certainly shaken up SA’s metered taxi industry in a major way, bringing fierce competition to a service that was overpriced and often unreliable.
Affluent and middle-class South Africans who were happy to hail taxis overseas, but had never used taxis in SA were suddenly "ubering".
The advent of Uber has done a fair bit to reduce drunk driving among the middle classes, with folk of all ages increasingly using the service to and from parties and drinking holes, whereas previously they might, hazardously, have driven themselves.
Uber is being used in SA for everything from doing the school run to providing some freedom for elderly folk who can no longer drive.

It has been a transformative technology in the South African context in which the mass market had long relied on unmetered minibus taxis — but the metered ones were not that much more desirable.

State capture is par for the course in SA’s culture of theft

State capture by business is an interesting concept that has burst into our political parlance in the past few months. It is in the main a polite way of calling out the relationship between our head of state and the now infamous Gupta family, which has come under scrutiny lately.

Ajay, left, and Atul Gupta. Picture: MARTIN RHODES

While the Gupta family is probably the most visible monument to such capture, they are only a tip of the iceberg, as noted and acknowledged by the alliance summit a few months ago.
Does anyone remember the manipulation of the African National Congress (ANC) Youth League leaders during the Fikile Mbalula and Malusi Gigaba eras by a member of the Kebble family?

Lack of Regional co-operation Hobbling potential of Africa’s Energy Sector

TWO crucial issues stood out on the agenda of the Africa Energy Indaba held last month: how to implement the regional integration of African energy supplies and how to find people akin to Bill Gates or Richard Branson to lead the industry.

 

Gregory Nott, energy specialist and director at law firm Norton Rose Fulbright SA, says the government’s independent power producer office has indicated that liquified natural gas (LNG) will be used for power generation in South African.
"The Mozambique gas finds must register as huge opportunities for South African and the region.

South African Spotlight is on private sector to stabilise SOEs

THE private sector’s role in stabilising the economy was highlighted in Finance Minister Pravin Gordhan’s budget speech.

 

The budget and President Jacob Zuma’s state of the nation address last month provide useful indications of where to start looking for opportunities.
Gordhan stated in "energy, transport, telecommunication and urban development, there are many opportunities for joint public and private investment and facilities management". He also focused on "appropriate" private sector participation in the financial uplift of several state-owned entities (SOEs). Gordhan spoke of three key priorities in the restructuring of SOEs: entities that are no longer necessary should be "phased out"; SOEs with overlapping mandates should be rationalised and potential private sector minority interest investment in such rationalised SOEs should be explored; and "co-funding partnerships" with the private sector should be considered to bring in private sector investment. "Phasing out" entities that are no longer relevant to the "development agenda" could see the disposal of noncore assets as the government looks to unlock value in the process.

'Elite workers’ myth needs tidying

ARE public sector workers a new labour elite in SA? Yes, according to researchers at the Development Policy Research Unit (DPRU) of the University of Cape Town. Their position is not new, though.

The Democratic Alliance and other commentators have been saying for years that the public sector is overstaffed and overpaid. If this belief were taken to heart and implemented, the result would be a disaster, not only for public sector workers, but for the entire working class, including the unemployed. 

Budget does not prompt rating move, says S&P

Rating Agency Standard & Poor’s (S&P) offered on Thursday a temporary reprieve, saying the country faced no immediate action after Wednesday’s budget.

"The budget lacks significant policy announcements that we think would immediately spur GDP (gross domestic product) growth, or provide much-needed business confidence to the private sector," the agency said. But it was not material to the rating, it said.

"Efforts in this regard continue to remain limited, particularly in labour relations, where strikes have in the past inhibited higher GDP growth and have the potential to do so this year again in the mining sector," the agency said.

S&P rates SA’s sovereign credit rating at BBB-with a negative outlook. This rating is just one level above speculative grade. Downgrades raise borrowing costs.

Nersa urged to check validity of Transnet hike bid

THE National Energy Regulator of SA (Nersa) must ensure that Transnet’s application for a tariff increase on its petroleum pipelines is indeed required for pipeline infrastructure and is not meant to cross-subsidise its rail projects.

This is according to transport economist Andrew Marsay.
He said on Thursday that because Transnet had not managed to raise enough money from its railway operations, it had resorted to cross-subsidising these with revenue from its pipelines and ports.

Online Experience Holds the Key to How Consumers Buy Cars

ONLINE connectivity is changing forever the way consumers are buying vehicles, says Glen Mollink, CEO at Innovation Group SA.

Gone are the days when buyers travelled between dealerships to see what was available, and for how much. Now, "at the click of a button, consumers can find multiple dealerships offering the models they want, in the right colour, at the right mileage and within their area". They could even compare prices. "Connectivity gives consumers massive choice," he said.

 

The change is happening faster in some countries than others. In developed markets, the first time customers visit a showroom may be to close the deal; to see the vehicle and perhaps take a test-drive. That is often not the case in SA, where much of the population still has limited online access. Some domestic motor companies, having started to invest in "virtual" showrooms more than a decade ago, say uptake by South African consumers has been slower than expected.

Growth at Risk as Factories Stuck in Rut

South African’s manufacturing sector is stuck in a quagmire and will drag economic growth even lower.
Key indicator Barclays purchasing managers’ index (PMI) on Monday showed a sixth consecutive drop last month.
As inventories continue to outstrip new sales orders, manufacturing production will be muted; this points to weak economic growth and more job losses in the sector.
Given that manufacturing is the fourth biggest contributor to gross domestic product, this bodes ill for the economy.

 

At 43.5, the PMI was more than five index points below last year’s average. The 50 point is neutral and anything below that indicates contraction.
The drop in SA’s and China’s PMI pushed the rand over the R16/$ barrier after it broke through the psychologically key level at the weekend although it recovered late in the day. The JSE and Shanghai Composite both closed down on the news.
China’s official PMI slipped to 49.4 from 49.7. A private survey, the Caixin-Markit China Manufacturing PMI, underscored the trend by showing factory activity shrinking for an 11th month. The PMI of SA’s other leading trade partner — the eurozone – also contracted, although it remained above the 50 mark.

IMF sees Growth at Less than 1% for South African

The International Monetary Fund (IMF) has slashed SA’s economic growth forecast to less than 1% this year, making it one of the more pessimistic.

 

As the economy would grow at its slowest pace since the recession seven years ago, investments would be crippled and joblessness would persist, the IMF said on Tuesday in its World Economic Outlook update.
In October it had projected growth of 1.3%.

MTN Group to Acquire Nigerian Internet Provider

MTN Group agreed to buy internet provider Visafone Communications of Nigeria to expand in Africa’s biggest economy even as the South African company awaits a local court ruling on a record $3.9bn fine in its biggest market.

MTN

The acquisition will ensure that "Nigerians experience a boost in the quality of broadband internet services" and data speeds, MTN Nigeria executive Amina Oyagbola said on Friday without disclosing terms.
MTN said in a statement that Visafone offered voice and online services in Nigeria.

Industries’ Total Turnover up in Third Quarter

THE total turnover generated by South African industries is 3.3% higher at R2.04-trillion in the third quarter compared with the second quarter.
Statistics SA’s quarterly financial statistics (QFS) survey showed on Tuesday that turnover rose in seven of the eight industries covered by the survey as economic growth picked up, although modestly, in the third quarter.

 
The survey results are used in compiling a gross domestic product (GDP) estimate, which in turn is used to develop and monitor government policy. The statistics are also used by the private sector to analyse business and industry performance.