South African Reserve Bank sees rising risk of downgrade to junk

THE risks of South African’s credit rating being downgraded had increased, but how the rand would react to a downgrade was uncertain, Reserve Bank deputy governor Daniel Mminele said on Monday night.

 
Ratings agencies Fitch and Standard & Poor’s will review SA’s credit ratings in two months’ time and both agencies have SA just one level above sub-investment grade, or junk status.

"The risks of a downgrade have definitely increased," Mr Mminele said. "So, an element would be priced in already, but how much more of a reaction one might have at the time (of a downgrade) is not so clear. There could be …

South Africa's Chamber of Mines asks for ‘Royalty Relief’

The Chamber of Mines, which claims to represent 90% of SA’s mining industry by value, wants the Treasury to give loss-making mines in the embattled industry "royalty relief" to save companies and retain jobs.

The chamber outlined a number of suggestions for Finance Minister Pravin Gordhan, who delivers his budget speech on Wednesday, pointing out the distressed nature of the local mining industry, which is under pressure due to globally weak commodity prices, rising domestic costs and falling productivity.

Since 2012, gold, platinum and coal companies had cut 47,000 jobs, chamber CEO Roger Baxter said earlier in February. Mineral Resources Minister Mosebenzi Zwane has said another 32,000 jobs were at risk.

Sasol seeks to fuel performance in Africa

SASOL has held discussions with various entities in Africa outside of SA on the long-term potential for a chemicals plant, the group’s executive, vice-president for chemicals Fleetwood Grobler, said on Thursday.

The chemicals and energy group has production facilities in SA, Mozambique and North America. It is investing $8.9bn in the state of Louisiana in an ethane cracker and processing plant that will treble its US chemicals capacity.

 

Mr Grobler said in its last financial year Africa, the Middle East and India contributed just under a third of the R105bn turnover of Sasol’s chemicals business. The short-to medium-term focus in Africa was on improving the performance of agents and distributors and selecting the best locations for a sales office.