** Obsession??
How so..?
He lives in France, not SA....

SA added 59,000 jobs in Q3
December 13 2011 at 03:51pm

--------------------------------------------------------------------------------

The number of people employed in the formal non-agricultural sector of the South African economy increased by about 59,000 persons (+0.7%) from the quarter ended June 2011 to the quarter ended September 2011.

This is according to the Quarterly Employment Statistics (QES) survey released by Statistics SA on Tuesday.

The survey also showed that an estimated 8.35 million people were employed in the formal non-agricultural sector of the South African economy. This reflected an annual increase of about 204,000 employees (+2.5%) compared with September 2010 (an estimated 8.15 million employees).

The mining and quarrying industry reported an annual increase of 16,000 employees (+3.2%) in September 2011 compared with September 2010.

There was a quarterly increase of 4,000 employees (+0.8%) in September 2011 compared with June 2011, the survey said.

The manufacturing industry reported an annual decrease of 8,000 employees (-0.7%) in September 2011 compared with September 2010. There was a quarterly increase of 3,000 employees (+0.3%) in September 2011 compared with June 2011.

This was mainly due to increases in employment in manufacturing of other food products; manufacturing of non-metallic mineral products not classified elsewhere; manufacturing of furniture; and manufacturing of special purpose machinery, the survey added.

The electricity, gas and water supply industry reported an annual increase of 2,000 employees (+3.5%) in September 2011 compared with September 2010. There was a quarterly decrease of 1,000 employees (-1.7%) in September 2011 compared with June 2011.

This was mainly due to a decrease in employment in electricity, gas, steam and hot water supply.

The survey found that the construction industry had seen an annual increase of 28,000 employees (+6.9%) in September 2011 compared with September 2010.

There was a quarterly increase of 15,000 employees (+3.6%) in September 2011 compared with June 2011. This was mainly due to increases in employment in building of complete constructions; and building installation.

The wholesale and retail trade; repair of motor vehicles, motor cycles and personal and household goods; hotels and restaurants industry reported an annual increase of 16,000 employees (+1.0%) in September 2011 compared with September 2010.

There was a quarterly increase of 7,000 employees (+0.4%) in September 2011 compared with June 2011.

The survey found this was mainly due to increases in employment in retail trade (except of motor vehicles and motor cycles); repair of personal and household goods; and hotels and restaurants.

The transport, storage and communication industry reported an annual increase of 8,000 employees (+2.3%) in September 2011 compared with September 2010.

There was a quarterly increase of 6,000 employees (+1.7%) in September 2011 compared with June 2011.

This was as a result of increases in employment in land transport and transport via pipelines; supporting and auxiliary transport activities; and activities of travel agencies.

The financial intermediation, insurance, real estate and business services industry reported an annual increase of 53,000 employees (+3.0%) in September 2011 compared with September 2010.

There was a quarterly increase of 18,000 employees (+1.0%) in September 2011 compared with June 2011.

This was largely due to increases in employment in business activities not elsewhere classified; insurance and pension funding (except compulsory social security); legal, accounting, bookkeeping and auditing activities; tax consultancy; market research and public opinion research; and business and management consultancy.

The community, social and personal services industry reported an annual increase of 89,000 employees (+4.0%) in September 2011 compared with September 2010, according to the survey.

There was a quarterly increase of 7,000 employees (+0.3%) in September 2011 compared with June 2011 as a result of increases in employment in government departments; provincial administrations; and health and social work. - I-Net Bridge

** Obsession??
How so..?
He lives in France, not SA....

so why not ask in Euros so he can compare to his buying power. if in USD it has no reference or relevance to SA or France.

http://us-cdn.creamermedia.co.za/assets/articles/images/resized/0000169353_resized_transnetmultiproductpipelinenmppjamesonpark20112duaneonline.jpg

http://us-cdn.creamermedia.co.za/assets/articles/images/resized/0000169352_resized_brianmolefemafikamkwanazi10112duaneonline.jpg

State-owned freight logistics group Transnet took delivery on Wednesday of its new multiproduct pipeline (NMPP), which runs between the coastal city of Durban and Jameson Park, near Heidelberg, south of Johannesburg. The pipeline, which would be commissioned in stages over the coming 18 months, is currently handling the delivery of diesel fuel to South Africa’s economic heartland of Gauteng.

The NMPP, which has been designed to handle various transport fuels, would eventually replace the aged Durban-to-Johannesburg pipeline, which was completed in 1965 and was nearing the end of its economically usable life.

The 555-km, 24-inch NMPP would initially work in conjunction with the old pipeline, until Terminal 1 at Island View, in Durban, and Terminal 2 at Jameson Park were fully completed in 2013.

The first product began flowing into the Gauteng fuel pipeline network, which connects at Jameson Park, when Transnet group CEO Brian Molefe opened a valve on the NMPP.

The Gauteng fuel pipeline network had also been upgraded in conjunction with the construction of the trunk line. This secondary network comprises a 16-inch pipeline network, linking Gauteng fuel depots between Kendal and Waltloo, Jameson Park and Alrode and Alrode and Langlaagte.

“We have completed one of the most cutting-edge and innovative infrastructure investments in the world. Transnet is today fulfilling two commitments, by ensuring that the inland market demand for fuel is met, and to ease road congestion by reducing the number of fuel tankers on our roads,” Molefe said.

However, Molefe also indicated that the pipeline’s price tag of R23.4-billion would now need to be recovered. In addition to last year’s pipeline tariff increase 59.9% Transnet had already applied to the National Energy Regulator of South Africa for a further 22% increase.

The state-of-the-art pipeline would transport refined fuel products such as unleaded 93 and 95 octane petrol, low sulphur and ultralow sulphur diesel and jet fuel at a rate of about three-million litres an hour. The capacity of the line would be 26.7-billion litres of fuel a year.

Currently the pipeline uses three pumping stations, namely Tweni in Durban, Hilltop near Pietermaritzburg and Mnambithi pump station near Ladysmith. Two metering stations are also included.

Transnet pipelines CEO Charl Möller pointed out that the project had been designed with expansion in mind.

“The pipeline would be upgraded in five phases up to 2032 with the addition of more pumping stations and metering stations along the trunk line. In this way we would be able to expand the pipeline capacity by up to 200%, to keep up with the expected demand growth,” he said.

He added that although the pipeline could currently only operate at half of its Phase 1 desing capacity, owing to the storage terminal at Jameson Park not being finished, and could also only carry a single product, the pipeline would come into its own once the terminals came on line.

The completed pipeline, as well as the two terminals under construction, had been designated as national key points, which would help ensure fuel supply security. The NMPP would also be able to provide fuel product for three days, should there be a supply interruption.

The pipeline was expected to be economically active for the next 80 years and provide permanent jobs for at least 110 people.

The project used a groundbreaking technology to prime the completed empty pipe, using nitrogen to counter backpressure encountered on the steep downgrades where the pipeline comes down Van Reenen’s pass on the escarpment. It was also dried at -20 ˚C, to ensure that no water or other liquids remained in the pipe that could lead to contamination.

Further, the pipeline, which is constructed form the highest available grade steel, was laid in 1.5-deep trenches along most of its route, except where it had to cross other existing infrastructure and rivers, as well as a number of large ecologically sensitive wetlands

http://www.engineeringnews.co.za/

Wow, who would have thought that SA can borrow money at cheaper rates than some European countries?


Jan. 9 (Bloomberg) -- South Africa sold $1.5 billion of 12- year bonds, tapping international markets for the first time since March to take advantage of near-record-low U.S. interest rates to repay existing debt.

The country sold the 4.665 percent debt at par to yield 270 basis points more than U.S. Treasuries, according to a person familiar with the transaction who asked not to be identified because he isn’t authorized to speak publicly. Barclays Plc and Citigroup Inc. managed the sale.

South Africa followed Brazil, Mexico, Indonesia and the Philippines to the dollar bond market this year, betting yields on U.S. Treasuries are set to rise as the world’s biggest economy expands. Benchmark 10-year yields will climb to 2.6 percent by Dec. 31, from 1.98 percent today, according to the median estimate of 63 economists and strategists surveyed by Bloomberg. Indonesia sold $1.75 billion of 30-year, dollar- denominated bonds today to yield 5.375 percent, or 240 basis points above U.S. Treasuries.

“The pricing was fair and caused the outstanding curve to sell off,” said Jeremy Brewin, who oversees about $4 billion at Aviva Investors in London, about the South African bonds. Brewin said he bought both Indonesian and South African debt today.

The yield on South Africa’s $1 billion of 5.875 percent bonds due 2022 jumped 15 basis points to 4.32 percent as of 4:20 p.m. New York time, the highest since Nov. 29. The yield on the comparable U.S. Treasury note fell three basis points.

U.S. Filing

The Treasury intends to use the proceeds of the sale to repay maturing debt, and for general government purposes, it said in a prospectus filed today with the U.S. Securities and Exchange Commission.

South Africa plans to sell about $1 billion a year on international capital markets over this and the next two fiscal years as slower growth in Africa’s biggest economy puts pressure on revenue, Finance Minister Pravin Gordhan said in his mid-term budget statement in October. The Treasury sold $750 million of securities in March.

“The timing so early in the year must surely be related to the low level of 10-year U.S. Treasuries,” Michael Grobler, a Cape Town-based analyst at Afrifocus Securities, said by e-mail in response to questions. “Generally, offshore interest remains buoyant,” with most money managers “running overweight South African dollar bond positions.”

South Africa’s long-term foreign-currency debt is rated A3 at Moody’s Investors Service with a negative outlook. Standard & Poor’s rates the nation’s debt BBB+ with a stable outlook.

Nedbank Group Ltd. and Rand Merchant Bank, both based in Johannesburg, are co-managing the sale.

--With assistance from Drew Benson in New York. Editors: Antony Sguazzin, Glenn J. Kalinoski

To contact the reporter on this story: Robert Brand in Cape Town at rbrand9@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

Johannesburg: SA's biggest export to China is not mineral resources; it is the rand - yes, hard currency. In its Africa Macro report released on Thursday Standard Bank noted that China has been purchasing an average of US$1.1 billion per month of physical rand (notes and coins) since November 2010. "China imported US$3.4 billion worth of ZAR in 2010 and another US$10.9 billion in the first three quarters of 2011," said Standard Bank.

Interestingly, the emerging super power has also been buying around US$1 billion worth of Swiss Francs every month.

According to the report, SA's exports of goods to China have grown faster than imports and will reach a record US$15 billion this year, making the country's growth in exports faster than any of China's plus-$1 billion partners in Africa. South African exports to China have increased by 44% year on year (Y/Y) in the first three quarters of the year, increasing from US$8.2 billion to US$12 billion. That means SA currently accounts for nearly one fifth of all African exports to China.

Trade between Africa and China is set to grow by US$30 billion to US$155 billion this year, which puts Africa's trade with the emerging super power on a par with that of Latin America. In a newly released report Standard Bank noted that SA was serving as the primary engine for growth in trade between the two continents. However, SA's export basket is heavily skewed towards commodities.

"Despite stated intentions to alter the status quo and rebalance trade, SA's exports to China remain dominated by mineral products," the report noted.Mineral products have increased rapidly - by about 68% y/y - to US$5 billion with China accounting for nearly 60% of SA's exports of iron ore.

While exports of other ores - including US$780 million worth of chrome; US$393 million worth of manganese and lead worth some US$115 million - are material, exports of coal have surged to US$602 million.

In the meantime, SA is set to import nearly twice as much from China in 2011 as it did in 2009, which ensures it remains China's largest market in Africa. Standard Bank estimates that SA will import US$13.5 billion worth of goods from China this year. In the first three quarters of the year imports had increased from US$8.8 billion in 2010, to over US$11 billion. It said SA was on track to import about US$2 billion of clothing, US$2 billion of nuclear reactors & machinery, and US$2 billion of electrical equipment and appliances from China in 2011.

However, for all the good bilateral trade might be doing the country - particularly since its inclusion in BRICS, the report warns that SA should not lose sight of Africa as one of its largest markets.

"SA must not forfeit the only market where it enjoys a comparative advantage for its goods. Relative to China, SA's economic deficit is clear. Seemingly as a result, SA met its invitations to the BRIC summit in Sanya by stressing its ability to act as a gateway into Africa for BRIC trade and investment. Not only is the claim questionable, but it would be foolish: SA has exported ten times more machinery, electrical goods and vehicles into Africa than into the BRICS so far this year," the report reads.

Chinese companies continue to allocate resources (both capital and people) to grow their presence in SA. At the start of the year, just seven countries in the world had greater official Chinese FDI stocks than SA and, considering the large commodity-related investments this year, FDI surged once again, the bank noted.

"SA and China have, rightly, prioritised bilateral ties, but commercial tentacles reach far deeper. However, looking ahead, the quality and substance of bilateral interaction will become more important, defining success."
http://www.trademarksa.org/news/sas-biggest-export-china-rand

Jan 13 2012

Reuters

Fitch cut South Africa’s rating outlook to negative from stable on Friday, saying it had seen limited progress on several long-standing structural issues that have over time caused the country’s economic performance to fall behind its peers.

The rand fell 1.5% against the dollar after the move, while South Africa’s 5-year credit default swaps rose 10 basis points.

Fitch, which has a BBB+ rating on South Africa, said the country’s inability to create jobs, with an unemployment rate of around 25%, was putting pressure on growth and narrowing the tax base.

The ratings agency said the country’s external finances, though still better than its peers, were deteriorating and a failure to accelerate growth would weaken the country’s credit fundamentals.

MORE (http://www.fin24.com/Economy/Fitch-downgrades-SA-outlook-20120113)

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Poor service delivery ‘killing SA business’
South African Chamber of Commerce and Industry says a firm could ‘sink or swim’ on the proficiency of its municipality'

AMANDA VISSER and LINDA ENSOR
Published: 2012/01/23 06:46:58 AM

SERIOUS accounting and administrative problems at all three levels of government are restricting job creation and raising the cost of doing business, says the South African Chamber of Commerce and Industry.

In some areas, companies are undertaking government functions themselves in order to continue operating.

A survey by the chamber at the end of last year found almost 21% of respondents believed service delivery problems were preventing them from doing business.

Standard Bank economist Johan Botha said companies were thinking twice about investing in large capital projects. "Many companies do have cash available and interest rates are at their lowest in almost 35 years. Yet, several factors, including the lack of delivery from government, increase uncertainty. Therefore companies adopt a wait-and-see attitude."

The findings of the survey provide an insight into the harmful effect government maladministration is having on economic activity, the acceleration of which is vital if SA is to address its job-creation challenge. Finance Minister Pravin Gordhan highlighted the extent of such maladministration in Limpopo last week when he justified having put five departments in the bankrupt province under national administration.

Other provinces, such as the Eastern Cape and North West, are plagued by similar deficiencies, and local government — the most critical instrument of service delivery — is floundering in many parts of the country.

A report released by the Treasury 10 days ago revealed that local government finances had deteriorated significantly over the past four years and that the "increasingly visible" failures were harming service delivery.

Sixty-six of the 278 municipalities in SA were identified as being in financial distress as of June last year — about the same number as in 2009-10, with 37 more on the borderline.

Signs of distress identified by the Treasury included the persistence of negative cash balances; overspending of operating budgets; underspending of capital budgets; and the high number of creditors and debtors.

In the 2009-10 financial year only seven of the 237 municipalities audited received unqualified audit reports and 53 received disclaimers because the municipalities concerned had not provided sufficient document ation for the auditor to form an opinion.

Auditor-general Terence Nombembe also reported last week that unauthorised, irregular, and fruitless and wasteful expenditure had grown from R3,9bn in 2009-10 to R4,5bn in 2010-11.

The chamber’s survey on service delivery problems found that road maintenance was the worst (39,7%), followed by electricity distribution (32,9%), water and sanitation (12,3%), parks and public spaces upkeep (11%) and solid waste removal (4,1%).

Service delivery problems caused higher operating costs for 52% of respondents, with 20,5% saying these prevented them operating at all, and 19,2% saying the failures reduced the amount of business generated. Only 8,2% did not see service delivery problems hurting business.

Andre Oberholzer, head of communications at Sappi , agreed that nondelivery of services had increased the operational costs of the JSE-listed pulp and paper maker. A business could "sink or swim" on the proficiency of its municipality, he said.

"Government is supposed to enable economic growth," he said. "Its fundamental role is to remove stumbling blocks in the way of economic growth, yet it is the biggest creator of stumbling blocks."

He said Sappi had to maintain the roads for the use of its trucks transporting logs from the forests to the mills, because provincial roads in the forestry areas where it operated were in a serious state of disrepair.

"We have had discussions with local authorities (in the areas where Sappi operates) but received no reaction, so we had to do something ourselves. The problem is that local communities now expect us to take over the maintenance role of the state," Mr Oberholzer said. Delays in issuing permits and licen ces had a ripple effect, adding to the cost of doing business.

"Government has committed itself to the extension of forestry areas for communal projects yet the communities have to jump through so many hoops to get the projects off the ground, with government departments actually working against each other (in terms of policy issues)."

Border Kei Chamber of Business CEO Les Holbrook said that in Gonubie, a flourishing area, a moratorium had been placed on new developments as the local authority was unable to keep pace with infrastructure development.

The moratorium on development in other areas has had a knock-on effect on companies involved in property management. The decline has been more severe in Durban and Cape Town, with some growth still evident in Pretoria and Johannesburg.

The Buffalo City municipality gained metro status last year, but there was little evidence of benefits to the businesses and residents of the area, Mr Holbrook said.

"Companies have been experiencing severe hardships, with the city sliding backwards in terms of service delivery."

Of grave concern was the suspension of people in key positions and the inability or unwillingness to appoint people to vacant positions. "We would like to build a relationship with the leadership, but it is rather difficult to do that when the people are constantly being suspended because of personality clashes and municipalities snatching qualified officials from each other."

A civil engineering group in the Eastern Cape, which preferred to remain anonymous, said it was almost impossible to undertake long-term planning because there was no consistency in the awarding of tenders, infrastructure provisions in budgets, and the flow of work. With I-Net Bridge

I remember saying that the massive drop in FDI in 2010 was an anomally and not related to politics, well seems I've been vindicated...


Foreign direct investment into South Africa more than tripled last year, reversing a sharp drop in 2010, but inflows into Africa as a whole fell, according to preliminary data from the United Nations Conference on Trade and Development Tuesday.

FDI into South Africa rose to $4.5 billion in 2011, from $1.2 billion in 2010. The 2010 investment had plummeted to about a quarter of the 2009 level.

The 2011 rise was boosted significantly by Wal-Mart Stores Inc.'s (WMT) $2.4 billion acquisition of a majority stake in South African retailer Massmart Holdings Ltd. (MSM.JO).
The rise in South Africa comes even as many investors grow wary of the country's political path. South Africa is struggling with rising unemployment and widening gaps between rich and poor.

The International Monetary Fund on Tuesday lowered its growth outlook for sub-Saharan Africa and South Africa in particular. In an update to its World Economic Outlook, the organization said it now expects sub-Saharan Africa to grow 5.5% this year instead of the 5.8% it had estimated in September.

The IMF cut its forecast for South African growth in 2012 to 2.5% from 3.6% in September.

Earlier this month, South Africa's Reserve Bank also lowered its forecast for growth in 2012 to 2.8% from 3.2%. Adding to foreign investment jitters, South Africa's ruling African National Congress is mired in a debate over how to reform the important mining industry, with nationalization seen as an option.

Overall FDI inflows to Africa continued to decline on the year, but at a slower rate than in 2009 and 2010, UNCTAD said. The 0.5% drop into Africa contrasts with a 13.7% rise in developing countries as a whole. South Africa's foreign investment rise didn't offset a sharp drop in Egypt, Libya and Tunisia, UNCTAD data shows.
Central Africa and East Africa also saw a drop in foreign direct investment while inflows into West Africa and Southern Africa rose, UNCTAD said



http://www.foxbusiness.com/news/2012/01/24/south-africa-2011-fdi-more-than-triples-africa-overall-down/#ixzz1kSciuVsm

Yes, it is just ebb and flow - hopefully this will continue to rise through 2012.

Anyway, here is another view from Engineeringnews...

SA’s strong FDI recovery not enough to lift Africa COMMENT PRINT EMAIL |

By: Terence Creamer
25th January 2012
TEXT SIZE A 269% recovery in South Africa’s foreign direct investment (FDI) inflows in 2011, which climbed to $4.5-billion from a revised 2010 figure of $1.2-billion, was not sufficient to reverse the decline in overall inflows to Africa as a whole, which fell for the third consecutive year.

The recovery in Africa’s largest economy was also not enough to offset a significant decline in FDI flows to North Africa, which experienced material political transformation during the period.

In fact, the United Nations Conference on Trade and Development’s (Unctad’s) ‘Global Investment Trends Monitor’ shows that FDI inflows to Africa, which started declining in 2009, continued to fall last year, albeit at a reduced rate.

By contrast, global FDI inflows rose 17% year-on-year to $1.5-trillion, despite the prevailing economic and financial turmoil, with developing and transition economies accounting for half of that amount, with record inflows of $755-billion.

Overall African inflows contracted by 0.7% to $54.4-billion, from $54.7-billion in 2010.

The results were influenced by a fall-off in FDI flows to Libya, Tunisia and Egypt, with inflows to Egypt falling by more than 92%, from $6.4-billion in 2010 to only $500-million last year.

The report shows that Central Africa and East Africa also experienced decreases in inward investment flows. But West Africa and Southern Africa showed “robust” growth, with Nigeria reporting a 12% rise in FDI inflows, from $6.1-billion to $6.8-billion.

The South African recovery was underpinned by the $2.4-billion purchase of a majority interest in JSE-listed Massmart by retail giant Wal-Mart, of the US.

The deal was not large enough to feature on Unctad’s list of the 70 cross-border merger and acquisition (M&A) deals with a value greater than $3-billion. However, it supported a country-level turnaround from the shock 70% slump of 2010.

Nevertheless, South Africa’s 2011 performance was well below the country’s inflow peak of $9-billion achieved in 2008.

A number of commentators have also argued that South Africa’s performance should have been better, particularly in light of the strong commodity markets, which have supported investment flows in other resources-heavy economies.

Studies show that mining’s contribution to South Africa’s gross domestic product declined by 1% over the last decade, while it had climbed strongly in other resources-rich countries, including China, Chile, Russia, Indonesia, India, Colombia, Australia and Brazil.

Unctad estimated that FDI flows were likely to rise moderately in 2012, to around US$1.6-trillion.


Edited by: Creamer Media Reporter

Top 250 global retails report. SA has five companies on the list, the only African companies represented...

http://www.deloitte.com/view/en_GX/global/f9f6b21f1d464310VgnVCM1000001a56f00aRCRD.htm

SA firms improve position
Jan 29 2012 17:15 Letitia Watson

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SA firms improve positionJan 29 2012 17:15
SA's major retailers have risen in the rankings of the 250 global companies, with Shoprite still leading the local pack, according to a Deloitte report.


Cape Town – South Africa's major retailers have risen in the rankings of the 250 global companies. Shoprite Holdings [JSE:SHP] still leads the local choir at No 92. This can be seen in Deloitte’s latest annual global retail report, Global Powers of Retailing 2012: Switching Channels.


The research is based on sales in 2010, a period during which emerging market retailers struggled to grow their sales. In order to compare sales across the globe, the figures are presented in US dollars. According to its international ranking, there would indeed appear to be a Checkers around every corner. The Shoprite group is the largest retailer in Africa and the Middle East and was previously 95th on the global list. In 2010 sales were worth around $10bn.


Massmart Holdings [JSE:MSM] is the second largest in Africa and 126th on the global ranking, with sales of $7.6bn. Pick n Pay Stores [JSE:PIK] is not far behind at No 133, with $7.1bn in sales. It is the third largest on the continent. Spar Group [JSE:SPP] sales amounted to $4.7bn, making it the fourth largest in Africa and No 179 globally.


Steinhoff International Holdings [JSE:SHF], which made acquisitions in Europe just as the European credit crisis began, appeared on the global list for the first time at No 218. Group sales totalled $3.7bn.


Woolworths Holdings [JSE:WHL] improved from No 248 to 222, with sales worth $3.6bn. Metcash, which underwent restructuring lost its position on the list.


The strongest compound annual sales growth in the region was achieved in Africa and the Middle East during the past five years with growth of 15.4%, said Rodger George, Deloitte’s consumer business leader. Latin America came second with growth of 14.8%, but all the other regions grew less than 7.6%.

- Sake24

I listened that the inflation rate is going to increase by more than 5,5 % this year? This truth is? If yes not well for the household consumption and the economic growth.

Didn't inflation break through the 6% target in November? I think it's currently stabilised at 6.1%.

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ANC study ‘advises against’ mine grabs

African National Congress research report could help settle debates on nationalisation of South Africa’s mines and succession
SAM MKOKELI
Published: 2012/02/02 06:57:59 AM

THE African National Congress (ANC) research team on nationalisation has resubmitted its report to the party, and while it is confidential, it is reliably understood to discourage " asset grabs" and buying stakes in mines.

The report could go some way towards settling the vexed question of nationalisation in the ANC, which has been pushed by its youth league to adopt it as official policy, despite warnings that it would discourage investment in SA’s already ailing mining sector.

The nationalisation debate is also being used as a political tool in the party’s succession debate.

The report, which is expected to be discussed at the party’s national executive committee meeting this weekend, is said to discourage asset grabbing as it is unconstitutional, and the purchase of stakes because the government could not afford it.

However, it apparently recommends an upwards revision of royalties and tax regimes. It is said to recommend more beneficiation of raw materials and the introduction of higher taxes on exporters of unbeneficiated materials.

A separate discussion document on the economy, compiled by the party’s economic transformation committee, will also be tabled at the meeting. It is also understood to oppose nationalising mines in favour of greater beneficiation.

Making it compulsory for retirement funds and insurers to buy state-owned companies’ bonds is also on the cards.

An export levy has been suggested, as a way to "ensure security of supply" of commodities.

The ANC wanted incentives to encourage local beneficiation, meaning it would have to introduce taxes and penalties. There were, however, no specifics in the report on what incentives and taxes should be introduced, and the government will have to come up with these details.

ANC economic policy chief Enoch Godongwana yesterday said the intention to create a mineral beneficiation industry was the "stated policy of the ANC".

"Where technology allows, we should make sure that we add as much value as possible." Beneficiated minerals would be for domestic consumption and export.

The nationalisation report was compiled by three economists and was intended to guide the party’s discussions about how to better distribute the benefits of the country’s mineral wealth.

Pundy Pillay, one of the three researchers, said they had given the report to ANC secretary-general Gwede Mantashe early last month. The ANC had sent the report back to the researchers in December, asking them to write it in simple language and provide more details.

Prof Pillay, a lecturer at the University of the Witwatersrand, worked on the research project with independent researcher Paul Jordaan and Margaret Chitiga-Mabugu of the Human Sciences Research Council. They visited a dozen mining countries, including Botswana, Australia and Brazil.

If approved by the party’s national executive committee this weekend, their report will be released to the public and the lower ANC structures in preparation for the party’s June policy conference. A final policy decision will be taken at the Mangaung elective conference in December.

Sources said influential ANC leaders were opposed to the idea of the state owning mines.

On the ANC’s economic policy committee are respected business-friendly leaders such as Cyril Ramaphosa and Trevor Manuel .

However, at least two provinces and the youth league have formal resolutions calling for nationalisation. They have the backing of some of the allied labour unions, but the Congress of South African Trade Unions (Cosatu) and the South African Communist Party do not favour buying mines or confiscating them.

Some Cosatu affiliates argue that the mineral rights are already in the hands of the state.

The ANC will discuss policy proposals from all of its subcommittees, which will feed into the discussions ahead of the policy conference. The policy discussions happen amid serious tension in the party, relating to ANC Youth League president Julius Malema’s appeal hearing.

Mr Malema has appealed against a five-year suspension from the party, which came after he was convicted of disrespecting party leaders and sowing division. This will be the first meeting of the national executive committee since Mr Malema’s appeal, which was heard by an appeal committee chaired by Mr Ramaphosa last week. It is understood Mr Ramaphosa’s committee is yet to discuss and reach a verdict.

ANC leaders from Limpopo could also use the meeting to complain about five departments being taken over by the national government, which said they were badly run. They have complained that the national government took over the departments in order to curtail a group that was hostile to President Jacob Zuma .

mkokelis@bdfm.co.za

"Pundy Pillay, one of the three researchers, said they had given the report to ANC secretary-general Gwede Mantashe early last month. The ANC had sent the report back to the researchers in December, asking them to write it in simple language and provide more details"

BWAAA_HAHHAHAHAHAHAHA!!!
PS - I am very relieved if Nationalisation doesnt go ahead, and am keen on beneficiation - though it will make us an even great er polluter!

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Nationalisation taken off the table at mining indaba
SHARDA NAIDOO - Feb 06 2012 07:34

Deputy Mineral Resources Minister Godfrey Oliphant has set the tone for the four-day Investing in Africa Mining Indaba, which begins on Monday, by bringing home the message that nationalisation is off the table and that South Africa is open for business. "As we speak, nationalisation is not a policy of the government or ANC," he said.

Oliphant was speaking at a precursor roundtable discussion on Sunday night, organised by Brand South Africa in Cape Town, as the ANC national executive committee (NEC) was wrapping up discussions on its economic policy documents, one of which dealt with the controversial proposal by now ousted ANC Youth League leader Julius Malema to nationalise mines.

The tabling of the documents could not have been timed better. Not only did the ANC squash the nationalisation policy, an appeals committee also upheld Malema's suspension from the ruling party's structures.

ANC sources said Mineral Resources Minister Susan Shabangu will give delegates a taste of the new resource nationalism plan in her opening address on Tuesday while President Jacob Zuma will use his State of Nation address on Thursday -- when the indaba ends -- to end the nationalisation debate and reassure investors.

The "land grab style" of nationalisation dominated talk at the indaba last year, giving investors and mining bosses jitters and creating market uncertainty for the past two years.

This year delegates from around the world, braving the blistering heat in Cape Town, will hear about the government's model to increase control of the country's $2.4-trillion non-energy mineral wealth and push up taxes on mining companies' profits and exports.

"I can't put my head on the block about nationalisation but we are definitely going ahead with the beneficiation policy. We want a model where everyone works together, the private sector, state-owned enterprises and government, that benefits all South Africans," said Oliphant, indicating that government was moving more towards a centralised model where government consolidates all its resource assets.

'Comparative advantage'
He added: "We're still not realising the considerable potential presented by our comparative advantage in minerals. Investors need to realise that they can't just come here and grab and go. The industry has not been committed to beneficiation over the years. That is going to change. There will be new rules."

The National Development Plan, the New Growth Path -- which has a 5-million jobs by 2020 target -- and the associated Industrial Policy Action Plan all call for an increase in beneficiation of strategic minerals as a way to enhance value of exports and stimulate investment in manufacturing. As it stands, raw minerals are exported out of the country and the finished product is imported.

Oliphant said the value chain sectors targeted for beneficiation are iron ore and steel, energy commodities, autocatalytic converters and diesel particulates, titanium and jewellery.

These are some of the interventions contained in the ANC's five economic policy documents, which Oliphant said will be released for public debate from Monday before it goes to the ANC's policy conference in June and taken to the elective conference in December.

But given the debate between government officials and the private sector at the roundtable discussion, the new resource nationalism plan is also likely to sit uncomfortably with investors and mining companies.

Apart from increased regulation around safety and rehabilitation of mines and transformation targets, one of proposals on the table is state control through rent share, and growth and development.

Some of the interventions include a 50% tax on the sale of mining rights, a wind fall tax of up to 50% on super-profits (defined as a return on investment of 22%), a reduction in the royalty tax from 4% to 1%, a super ministry merging five ministries to police minerals governance and a rent share of mining rights.

Investment regime
But BHP Billiton South Africa chairperson Xolani Mkhwanazi emphasised: "If the mining regime disadvantages the investment regime, then investors will look at a country with more competitive regulation."

The perceived over regulation of the industry, talks of nationalisation and infrastructure constraints were some of the main reasons why South Africa missed the resources boom that followed the 2008 global financial crisis.

Mining, once the highest contributor to South Africa's gross domestic product, now only accounts for 6% and it has shed more than 100 000 jobs since the financial malaise. Poor or lack of infrastructure was identified in national treasury's medium term budget statement as choking the mining industry and stumping growth.

There were also stinging comments from Oliphant about mining companies creaming profits but their poor record on the safety, environmental, transformation and community development side.

"Where has all those profits gone to. The realities on the ground show there has been no transformation. Mines implement non-sustainable income generating projects that are not yielding any benefits to the communities and most are not creating jobs. Government will push for that to change."

But Bheki Sibiya, head of the Chamber of Mines, hit back saying government needed to more decisive around legislation and its engagement with companies. "Mining is one of the top five priorities of government, yet Zuma, as president of both the ANC and our country, has never once engaged with the mining industry."

He added to the debate around the mining industries lack of competitiveness compared to other mining investment destinations such as Canada and Australia.

"Yes, our record on safety is poor. We hang our heads in shame but we're working on it. We're learning from the Australians, who have an excellent safety record, even though we don't like them as a country. But we're losing to other jurisdictions because we struggle with railway, electricity and water infrastructure," he said.

Public, private engagement
He cited the Northern Cape as an example, saying more public, private engagement was needed: "We have 85% of the world's manganese reserves there, but only 23% of the world market. We need to work as team South Africa to win. We're supposed to be equal partners. Sometimes we score a goal, then celebrate and forget to score another goal."

Sibiya called for the super highway between Sishen in the Northern Cape and Saldanha Bay port along the Western Cape coast opened up to everyone.

This was after Peter Tamane of South African Mining Development Association, representing the junior minors, pointed out that infrastructure and lack of access to the ports was constraining growth of the smaller players.

He said getting resources out through Saldanha cost almost 80% less than using Coega, for example. Sibiya added that Coega was a "failure" and had become a "white elephant because it was built by government for political reasons".

The deputy minister retorted that the presidential infrastructure coordinating committee, which was set up in July last year, would deal with some of these issues.

National Planning Commission Minister Trevor Manuel will also lead a panel discussion that will scrutinise the infrastructure problems in the context of the importance of mining and resources in the growth and development of the economy. He will ask: "Could South Africa miss the boat?"

More than 6 000 individuals representing more than 1 000 international companies and about 40 African and non-African government delegations are expected to flock to the Mother City over the next few days for the Indaba. They include fund managers, mining analysts, investment bankers, government officials and chief executives of global and local mining companies.

While it's a talking shop, the beginnings of my big deals are said to have been facilitated in previous years at the indaba.

The good news is short-lived, the party of the "Forked Tongue" strikes again, with Mining Minister and Trevor Manuel clearly stating they're in favour of a nationalistic minerals policy, but not the nationalisation of mines. So there goes the boost in investment and jobs we were hoping for in the mining sector. Look at this guys quote, he doesn't like when investors say they won't come if nationalisation is policy: DUH! Homer Mantashe: Why would companies invest if that investment will be taken by the state? What planet do you live on...

Plus, the point about Chile and Brazil is invalid, as they have concrete, non-ambiguous mining policy with parastatals involved in some mining sectors, SA has NO clear policy and is sending mixed messages and companies feel they're being sent from pillar-to-post with no indication of what tomorrow will bring.

www.timeslive.co.za

We won't be bullied: Gwede
AMUKELANI CHAUKE | 07 February, 2012 00:4016

ANC secretary-general Gwede Mantashe says the ruling party will not be bullied into stopping discussion on the nationalisation of mines because it will scare off investors.

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Mantashe said this as Minister in the Presidency Trevor Manuel told a high-profile mining indaba in Cape Town yesterday that the nationalisation of South Africa's mines was not an option.

Mantashe, clearly irritated by continued speculation about the outcome of a report on mines nationalisation commissioned by the ANC, said the party would not be blackmailed by threats that investments would be withdrawn should nationalisation become government policy.

''One of the things I don't like is the threat of not investing, of not coming, or of [investors saying if you nationalise mines] we will go away,'' Mantashe told journalists at Luthuli House in Johannesburg.

''The beauty of minerals is that they are not mobile. The beauty of it is that you will come and find them here. I don't think we should use the blackmail approach in discussing an important policy matter in the ANC. And I think even . the threat of [saying the nationalisation of mines] is unaffordable [should be discouraged].''

Weekend media reports said an independent panel that had carried out the study for the ANC on the feasibility of nationalising the mines had recommended that nationalisation be rejected because it was not affordable.

The study reportedly found that the government would need to raise about R1-trillion to buy out listed mining companies.

The report, which has still to be debated by the ANC, apparently recommends a less expensive approach of increasing taxes on mining giants as a way of deriving more benefit from the country's mineral wealth.

The report was discussed at the ruling party's national executive committee meeting at the weekend, and Mantashe said party members and stakeholders would soon be invited to comment on it.

Only then would the ANC adopt it as a discussion document at its national policy conference in Midrand in June.

"What is important is what [are] the best practices internationally in terms of managing mineral resources,'' Mantashe said. "Why are investors and companies prepared to go 50-50 [ownership] in diamond mines in Botswana, [but] say that we must not even discuss that?

"Why do companies say that they can work with a state company in Chile and in Brazil [but] if it is in South Africa [discussing it] is a no-no?" Mantashe said.

However, Manuel's message at the 18th Investing in African Mining Indaba in Cape Town yesterday was that the mining industry deserved policy certainty from the government.

"The Minister [of Mineral Resources, Susan Shabangu] was pretty forthright in saying that there will be nationalisation over her dead body.

"Now you couldn't ask for a clearer statement than that," Manuel told the indaba, which was attended by financiers, investors, mining professionals and government officials.

"The mining sector is so fundamentally important as a platform to construct the [upliftment] transition that we can't be able to take this idea of nationalisation forward," Manuel said.

"If some doomsayer comes along and generates another lie [about nationalisation], don't believe them," he said.

In May last year, Finance Minister Pravin Gordhan identified the mining industry as one of the sectors with potential to create jobs.

And in June, mining giant AngloGold Ashanti said the mining industry generated R424-billion in revenue in 2010, and spent R49-billion in new projects and new jobs.

In 2010, the mining sector contributed about 1million jobs to the economy, half of them directly, and more than 50% of merchandise exports.

Yesterday, the Industrial Development Corporation released a research report that revealed reasons South Africa is failing to capitalise on its mineral wealth.

Factors identified include the introduction of a new minerals regime, infrastructure constraints, safety issues, falling productivity attributed to a poor mining safety record, escalating costs, skills shortages and a volatile exchange rate, among others.

The report recommended that, on top of investing in energy and transport infrastructure, South Africa should address shortages of professionals, especially geologists and mining engineers, and safety measures.

The debate around state ownership intensified when suspended ANC Youth League president Julius Malema made repeated calls for nationalisation of mines and other key sectors of the economy as part of the league's call for economic freedom.

Despite reports that Malema's calls were a threat to foreign investment, Mantashe yesterday said nationalisation was not about the youth leader or the league.

Since Malema called for nationalisation, several cabinet ministers, including Manuel, Shabangu and Public Enterprises Minister Malusi Gigaba, have vocally opposed the idea, suggesting that the league's calls were irresponsible.

Manuel said last year: "This country desperately needs investment, more specifically investment in our rich mineral endowment.

"And, if for no other reason than we need investment, we must declare repeatedly that the nationalisation of the mines is a seriously bad idea.

"Even reading the medium-term budget with half a brain will confirm that there are no fiscal resources available through taxes or borrowing to pay for mines or invest in them, even if the government were to get these mines gratis." - Additional reporting by I-Net Bridge and Sapa

What a bunch of clowns. They have no clue what's going on in their own party.

Bunch of fekking idjits.... I mean really....

All it takes is a little 1+1 to realise talking about nationalisation or anything like that is likely to scare of mining houses... and this country NEEDS them to survive.

They just need to put out a unified statement, so that the press can stop having a field day with them.
From what Trevor Manuel and Shabangu said, and other ministers - Nationalisation is not an option, and in reality, is not really physically possible or feasable.
I do think some of this is taken out of context, and that the very mention of the word has been hyped up into some evil communist conspiracy by the press.

Having said that, the ANC should by now have the maturity to call in its ministers and get them on the same page, with the same story.

^^ However, that's exactly what the "EVIL" media has been saying, the ANC are their own worst enemy. If they would have cohesive vision, would have decisive leadership and not speak with forked tongue, the media would have much less to play with.

I read on some article that the propossed tax would encourage mine companies to under report theire profit. My question; is this 50% tax on normal tax or on rent?

AFP - South Africa launched a new line of bank notes on Saturday bearing the image of its first democratically elected president, Nelson Mandela, on the 22nd anniversary of his release from prison.

"It is my honour and pleasure to announce that new South African bank notes will bear the image of president Mandela, the first president of a free, democratic South Africa," President Jacob Zuma told a press conference in Pretoria.

The notes bear the former president's image circa 1990, the year he was freed from prison in a moment that came to symbolise the fall of apartheid and the rise of a new, democratic South Africa.

Read more at France24 (http://www.france24.com/en/20120211-south-africa-launches-mandela-bank-notes)

www.timeslive.co.za
Cashing in on Nelson Mandela
RENÉ VOLLGRAAFF and MONICA LAGANPARSAD | 12 February, 2012 00:00

http://www.timeslive.co.za/Feeds/2012/02/11/876217_743044.jpg/ALTERNATES/crop_630x400/876217_743044.jpg
MONEY SHOT: South African Reserve Bank governor Gill Marcus and President Jacob Zuma with the country's new currency - after a slight panic over the announcement

Nelson Mandela's image will replace that of the Big Five on South African banknotes.

President Jacob Zuma made the announcement yesterday at the Reserve Bank in Pretoria on the 22nd anniversary of Mandela's release from prison.

The new notes will go into production immediately and will be in circulation before the end of the year.

This will be the first time the face of a former president features on the R10, R20, R50, R100 and R200 notes.

The new currency will also include upgraded security features and a raised strip for the visually impaired.

The South African Bank Note Company (SABN), which is owned by the Reserve Bank, has been embroiled in controversy over the past three years. Its former managing director, Musa Mbhele, was dismissed, and reports surfaced that the country's R100 notes were being printed in Sweden because an SABN machine had been printing the currency without a key security feature.

Reserve Bank governor Gill Marcus declined to say where the new notes would be printed, but said the Reserve Bank had every confidence in the SABN.

Marcus said the redesign of the banknotes - the first since 1992 - had cost R2.5-million.

News on Friday of an expected announcement of "national importance" by the Reserve Bank spread mild panic and led to a 2% drop in the exchange rate.

Marcus apologised for the confusion, but said: "Given the importance, we thought it was vital to announce the news officially and not just let it leak to the public."

She said Mandela was consulted about the redesign. "We personally went to see him and he was excited and very moved."

http://www.informafrica.com/wp-content/uploads/2012/02/Mandela-bank-note.jpg

I think it's a bit boring, to be honest. They could have placed his face on one of the notes and placed other faces on other notes for some variety.

I’m happy with this change. It’s appropriate.

But, like someone said on Twitter, keep an old R10 note so you can show your kids what a rhino looked like!

I think it's a bit boring, to be honest. They could have placed his face on one of the notes and placed other faces on other notes for some variety.

Actually, that move would scare me a little. Mandela is fitting, anyone else could be controversial. With the renaming exercise debacle in Durban, I think it's safer to just have the powers-that-be stick with Mandela.

Actually, that move would scare me a little. Mandela is fitting, anyone else could be controversial. With the renaming exercise debacle in Durban, I think it's safer to just have the powers-that-be stick with Mandela.

Very true.

Anyone know if what Johan15 said is true about the big five remaining on one side of the notes and Mandela's face replacing the design on the other side of said notes?

^^ Is true. Read this morning in the papers that the Big 5 will remain on the obverse side of each note.

^^ Is true. Read this morning in the papers that the Big 5 will remain on the obverse side of each note.

Then I don't mind it too much :) There's still some variety in the mix.

I'm not unhappy with this move to be honest.. I think it is entirely fitting that Madiba is on our notes... He is a great man.

What I am very very very very unhappy about is this "announcement of national importance" crap... do these numbnuts not realise that doing something like this will spook most of the business and investment community given the ANC's rhetoric over the last few months?.. and then they announce a new damn bank note.. how is this of national importance ffs?

That's something the DA was upset about too. Helen said she wished such a joyous announcement was handled in a more market-sensitive manner. The reserve bank can't just say, "We have a momentous announcement to make this weekend," whilst investors think: Are they abandoning inflation targeting? Is Gill Marcus leaving?

But anyways, at least its some nice news and something horrible. :)

That's something the DA was upset about too. Helen said she wished such a joyous announcement was handled in a more market-sensitive manner. The reserve bank can't just say, "We have a momentous announcement to make this weekend," whilst investors think: Are they abandoning inflation targeting? Is Gill Marcus leaving?

But anyways, at least its some nice news and something horrible. :)

Maybe Gill wanted to play the FX market and shorted a few currency forwads... :|

SA income gap narrows
Mon, 13 Feb 2012 11:34
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South African incomes have risen, while income inequality has narrowed over the past decade, a labour analyst said on Monday.

"After-inflation incomes have risen sharply, from R44 431 a year in 2000 to R61 645 in 2011 - a real increase of 39 percent, or a respectable 3.3 percent a year," Adcorp labour economist Loane Sharp said in a statement.

In the past decade, income inequality between the races, especially between blacks and whites, had declined sharply, he said.

"In 2000, the average black South African earned 15 percent of the average white South African's income, whereas in 2011, a typical black person earned 40 percent of a typical white person's income."

About 14 percent of the black workforce - or 1.3 million people - earn as much or more than the average white employee. This was up from 270 000 in 2000 - an increase of more than a million, or 378 percent, Sharp said.

"Over the past decade, government employment has increased from one million to 1.24 million, and the proportion of blacks in the civil service has increased from 42 percent to 74 percent.

"As a result, nearly 40 percent of South Africa's highest-earning blacks are employees of the South African government."

He said 70 percent of the public sector workforce belonged to a trade union, which had played a role in the increased wage levels.
In the private sector, around 26 percent of the workforce was unionised.

Sharp said, however, a more significant reason for the steep increase in black civil servants' incomes had to do with "managerial bloat".

"Officially, government wages have increased by just 5.4 percent a year, but the government has utilised the twin mechanisms of promotion and job re-grading (which are not subject to public sector wage agreements) to increase the income of black civil servants," he said.

The average remuneration for public sector workers was now 32 percent higher than that of private sector workers. Sharp said the compensation of employees represented nearly 90 percent of total government spending.

"Nonetheless, three in five of South Africa's highest-earning blacks are employed in the private sector - numbering around 820 000 at present."

Sharp said if the historical rate of progression was maintained, there would be 5.1 million blacks earning more than the average white in the private sector by 2020.

"At this rate, the income gap will close in less than 10 years: the average white person's income is currently rising by 5.3 percent a year, whereas the average black person's income is rising by 14.9 percent."

Sharp said government policies could be holding black incomes back. This included poor standard of education at public schools.

"The implication is that government policies, notably secondary schooling, restrictive labour laws and immigration controls, have been holding black incomes back.

"Without these counterproductive policies, blacks' incomes would probably be rising even faster relative to whites', and the income gap would be falling even faster," Sharp said.

SA created 80 000 jobs in Jan
Mon, 13 Feb 2012 11:10
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Around 80 000 news jobs were created in January, according to the Adcorp Employment Index released on Monday.

"The South African economy created 80 000 jobs in January, representing annualised growth of five percent over the previous month," Adcorp said in a statement.

However, the economy was still 420 000 jobs short of the peak employment level before the 2009 global financial crisis.

All sectors of the economy reported gains in employment in January, Adcorp said. Temporary work grew at a rate of seven percent and agency work at eight percent.

"Temporary work now represents 3.87 million workers or 30.1 percent of the workforce," Adcorp said.

The wholesale and retail trade grew almost 14 percent, transport and logistics nine percent, and government three percent.

Employment in high-skilled categories - management and professionals - grew almost five percent. This reflected the economy's ongoing reorientation toward high-skilled positions, Adcorp said.

The number of clerks, service workers and sales and marketing staff increased by eight percent. Adcorp said this showed the relative buoyancy of the consumer sectors of the economy.

Great news! :)

Thanks for posting.

This continues to look promising as well - I didn't even know Hague was here...hope for his sake he got to eat at the Bombay Brasserie, seeing as how this was held at the Taj!


Minister of International Relations and Cooperation, Maite Nkoana-Mashabane is seen with her British counterpart William Hague in Cape Town on Monday, 13 February 2012 during a bilateral meeting. Picture: Department of International Relations, Cooperation/SAPA

South Africa and the UK are looking to increase economic and trade ties by focusing on exporting high-value-added goods to Britain, the Minister of International Relations and Co-operation Maite Nkoana-Mashabane says.

Briefing media at the Taj Hotel in Cape Town, following a bi-lateral meeting with UK foreign secretary William Hague, Nkoana-Mashabane said trade had improved between the two countries last year after declining 37% from 2008 to 2009, amid the global financial crisis.

In the first 10 months of last year, South African exports to the UK had increased 10.7% while UK imports were up 30.6%. Last year, the two countries agreed at a bi-lateral forum to double trade between the two nations by 2015.

While the UK remains South Africa's top source of overseas tourist arrivals, with 453,000 arrivals in 2010, the country is also providing support to set up a Free Trade Area (FTA) in Africa and providing development assistance through its Department for International Development.

Trade between the two countries increased 77% between 2001 and 2008, growing from R42 billion to R74.5 billion.

Nkoana-Mashabane said there were more than 300 UK companies operating in South Africa and several SA ones in the UK, pointing out that the South African government wanted to encourage UK companies to invest in beneficiation and the agro-processing sector in South Africa.

Hague congratulated South Africa for successfully hosting COP17 in Durban in December and said the UK would continue to work with South Africa. "We will continue to work with you over the coming year and think that South Africa has given a very good strong lead in that area. And certainly our countries have worked very well together," said Hague, who is due to speak at the University of Western Cape today on bilateral trade between the two countries.

He said South Africa was a "truly global player" across a range of issues, including non-proliferation, climate change and conflict resolution.

PORTS INFRASTRUCTURE
R21.3bn set aside to raise container capacity at Durban harbour

15th February 2012

South Africa's State-owned Transnet National Ports Authority (TNPA) is planning to spend R21.3-billion on expanding and upgrading the infrastructure of the country's busiest harbour, Durban, in KwaZulu-Natal, over the coming seven years.

The investment programme, which involves a number of separate projects, is designed to create the infrastructure necessary to facilitate an increase in the overall capacity of the port, particularly the capacity of the Durban Container Terminal (DCT). Once completed the yearly container handling capacity of the harbour will rise from around three-million twenty-foot equivalent units (TEUs) to some five-million TEUs.

The budget forms part of the Transnet group's larger R300-billion investment programme for the period 2012 to 2019, which featured prominently in President Jacob Zuma's recent State of the Nation address.

The TNPA budget also included a set-aside to advance planning for a possible new port at the old Durban International Airport site. But the bulk of the capital would be directed towards reconstructing, upgrading and expanding the existing port infrastructure to cater for the handling of vessels with a capacity of larger than 9 500 TEUs.

Such vessels could already enter the harbour's recently enlarged and deepened entrance, but not at full load, owing to depth constraints in the channels, as well as at the berths.

TNPA's Hamilton Nxumalo reports that work is, therefore, progressing on a critical R3.1-billion berth-deepening and reconstruction project on the facility's North Quay, where the intention is to deepen the approaches at berths 205, 204 and 203 from 12.8 m to 16.5 m. The channels would also be widened to 19 m to accommodate the larger ships.

But Nxumalo stressed that the final design and capital investment value will only be determined on completion of the environmental-impact assessment (EIA). The EIA record of decision is only anticipated by May 2013, and TNPA is hoping to move the project into the execution phase from June next year.

The project itself, which will involve a large-scale dredging programme as well as a material overhaul of the berths, is only likely to be completed in 2017.

Durban Port manager Ricky Bhikraj says, while the project is in progress, DCT's handling capacity will be negatively affected and planning is, thus, under way to minimise the effects of the outages.

Some of the volumes would be redirected to the Port of Ngqura, in the Eastern Cape, while the balance would be absorbed by other berths within the Durban harbour itself.

In fact, several port- and land-side projects were already under way across the harbour to deal with existing bottlenecks.

Some of these projects include: a R600-million upgrade of berths two, five and six at Island View; the upgrade of the congested Bayhead road, which should be completed by July; a R1.6-billion upgrade of the long-neglected Maydon Wharf multipurpose berths; and a R148-million scour protection programme.

TNPA's sister company Transnet Port Terminals (TPT) is in the process of procuring mobile crane capacity, which would add operational flexibility during the berth outages.

TPT also has an extensive fleet renewal programme of its own for DCT, having recently concluded a deal with Shanghai Zhenhua Heavy Industries Company, of China, for the supply of seven tandem lift ship-to-shore cranes for the harbour.

Edited by: Creamer Media Reporter

SA to be hub in ABB’s assault on Africa’s ‘enormous’ power, resources potential
COMMENT PRINT EMAIL |

By: Terence Creamer
16th February 2012
TEXT SIZE Despite challenging market conditions in South Africa, global power and automation technologies group ABB has selected the country as one of two hubs from which it will pursue an even more aggressive assault on the African market, which has been selected as a key future growth jurisdiction – the other continental hub will be Egypt, in North Africa.

The group, which reported global revenues of $37.9-billion for 2011, during which its order backlog rose to a record $40-billion, was specifically targeting territories such as Africa, which are expected to expand at rates above 4% a year.

The move coincided with an announcement to investors that ABB might sacrifice part of its margin to invest for the future – a moved which resulted in the company’s shares retreating on Thursday when the Zurich-based company reported lower-than-anticipated earnings of $830-million for the fourth quarter of 2011.

Speaking in Johannesburg at a presentation held following the global earnings report, ABB South Africa CEO Carlos Poñe reported that Africa and South Africa had been identified as possessing ‘enormous potential’ in the areas of power and natural resources. This, notwithstanding a flat performance in 2011, when the unit’s order backlog was sustained at R3.4-billion.

ABB estimated that the continent could spend some $26.5-billion yearly on rehabilitating and expanding its power infrastructure up until 2015 and that Africa’s power generation capacity could double by 2035.

In addition, the group expected capital expenditure on African natural resources prospects to rise to $34.5-billion by 2015.

Poñe said that, while 15 years ago it would have seemed reckless to place much store on an expectation that capital projects in Africa would be implemented, the environment had changed. “These are not pie in the sky,” he argued, pointing to Vale’s Moatize project as an example of the fact that “real projects” were being implemented.

The new Africa strategy was adopted in November and “we are now starting to drive it in 2012”.

“We will use South Africa and Egypt as hubs to expand into Africa,” Poñe reported, noting that the group already had 30 regional sales and services centres and eight manufacturing facilities on the continent, occupying more than 400 000 m2 of factory real estate.

In the near-term, ABB planned to add 250 more people to the 4 500 who already worked in Africa, 1 500 of whom were engineers.

It was focusing on 10 target countries, including the Democratic Republic of Congo, Kenya, Angola, Tanzania, Mozambique, Nigeria, Ghana, Senegal, Cameroon and the Côte d’Ivoire.

Poñe was also cautiously optimistic about the potential for growth in South Africa, saying the recent emphasis given by President Jacob Zuma to infrastructure delivery was “very good news”.

He was also bullish about prospects for the supply of ABB solutions to conventional and renewable energy independent power producers, indicating that the company could benefit in the short to medium term from the solar projects associated with the Department of Energy’s procurement of the first 3 725 MW of renewables capacity.

Currently, Africa comprised only about $1-billion of the larger group’s $40-billion order backlog.

But Africa had been specifically targeted in line with the group’s strategy of growing at a pace that is faster than world gross domestic product. Initially, Poñe anticipated that this would translate into yearly sales growth across the continent of between 12% and 15% and later moving towards the 20% level, “as our strategy gains traction”.


Edited by: Creamer Media Reporter

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Sell parastatals, says DA
2012-02-20 22:24

Cape Town - The Democratic Alliance on Monday proposed partially privatising state enterprises to boost infrastructure spending to 10% of the national budget.

Presenting the DA's alternative budget, finance spokesperson Tim Harris said government should follow the example of Brazil, which this month raised some R70bn by privatising operations at its three biggest state-owned airports.

The deal saw the state retain a 49% stake in the operations and a Brazilian-South African partnership secure a contract to run Sao Paulo's Garulhos Airport for the next 30 years.

Harris said South Africa's infrastructure drive could be boosted by R55bn a year by partially listing state-owned enterprises and selling off their existing assets and investing the proceeds into building projects.

This would add more than 2% to the 7.8% of the budget President Jacob Zuma pledged last week to invest in infrastructure, without introducing new taxes or increasing the forecast deficit of 5.2%.

The DA's budget proposals, made two days before Finance Minister Pravin Gordhan tables his annual budget, foresees a slightly lower deficit and is part of policy changes the party is advocating to achieve sustained economic growth of 8%.

Political clout

Harris said the DA's main concern was job-creating growth and the first step towards this was the urgent implementation of Gordhan's plans for a R5bn youth wage subsidy, that ran into opposition from the trade union movement.

"That has to be implemented on the first of April. If the president and the finance minister lack the political clout to push it through, then that is a serious problem for the three plus million unemployed young people in South Africa today."

The DA proposed reimbursing the private sector for job training, cutting the state's wage bill by limiting salary increases to inflation levels and saving more money by doing away with several national departments, including public works.

It said it would create a single ministry of education and a single one for national resources, grouping minerals, energy, the environment, water and tourism.

A raft of such measures to streamline government could save about R3.3bn, freeing up more funding for education and projects that would stimulate growth and job-creation.

Harris conceded that the DA's call for limited privatisation ran directly counter to current government thinking, and that it would take more than a single budget cycle for any profits from such an exercise to reach the state coffers.

"There is a serious divergence between the ANC's programme and ours. The state is following a form of state capitalism and we believe that this isn't going to work in South Africa because frankly we don't have the capacity to deliver even the most basic services at national level."

DA parliamentary leader Lindiwe Mazibuko said the party's economic policies were compatible with the national development plan released in November, but added that with the new growth path the government had regrettably set off in a different direction.

"The new growth path... has a very different premise on how the state should be involved in the economy. We think that the aim of creating five million jobs is very admirable, but it is based on a flawed assumption of the role of the state."

- SAPA

BMW to invest 2.2bn in SA
Share 2012-02-20 20:59


LET THE BUILD COMMENCE: BMW SA has announced the start of production in Pretoria of the 2012 BMW 3 Series sedan - the third range of the performance cars in this country.>


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Sixth BMW 3 Series - the details
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BMW SA hits 3 Series high point
Author: Les Stephenson

Pretoria - BMW has invested R2.2bn in the South African economy to enable production here of a new vehicle series.

The announcement was made by National Economic Development Minister Ebrahim Patel on Monday at a function in Pretoria to mark the start of production at Rosslyn of a contract to assemble the sixth generation of the BMW 3 Series that was agreed some time ago and will run for seven years until 2018.

"[This] is a private-sector vote of confidence in our economy," Patel said in a speech prepared for delivery at Rosslyn in Pretoria, HQ of BMW in South Africa. It is also a huge vote of confidence from BMW worldwide in the ability of BMW SA to produce the quality of vehicles required.

85% EXPORTS

The production contact will eventually generate 600 jobs and is a major triumph for BMW South Africa against competition from around the world. The automaker’s home plants in Munich will produce the bulk of 3 Series production, followed by South Africa with an initial build of 50 000 cars a year rising to 90 000 annually.

The production run will involve a third shift at the Rosslyn plant.

The cars will also be assembled in Shanghai, China.

BMW SA exports about 85% of the cars it assembles. The plant's current capacity stood at 55 000 units a year but Patel said this was likely to exceed 90 000 a year with the new investment and build contract.

This will be the third 3 Series range to be assembled in South Africa since the first major agreement back in 1999 which in itself followed an investment in BMW SA of R1bn in 1996 to prepare for the original challenge. The South African-built cars will be supplied to all right-hand drive markets as well as to the US.

IMPORTANT MARKETS

Frank-Peter Arndt, member of the BMW AG management board responsible for production, said at the function: “The BMW 3 Series is the most important volume-produced model of the BMW Group as well as the biggest-selling model in the entire premium segment.

“At the same time, every generation of the 3 Series sedan has been built in Rosslyn and since 1999 this plant has been responsible for production for important export markets such as the USA, Canada, Japan, Singapore and Australasia to name but a few.

“In 2009 – when the economic crisis reached its peak – we decided to invest R2.2bn to increase production capacity here in South Africa to produce the new 3 Series Sedan.

“This was the clearest statement we could make at the time.”

Speaking at the event to commemorate the official start of production Arndt, also chairperson of BMW SA, explained that while the investment safeguarded around 2 500 jobs in the middle of the recession it would ultimately lead to significant increases in production, export and employment in years to come.

“In 1973, Rosslyn became the first BMW production facility to be established outside of Germany,” he reminded, “so it is fitting that, almost 40 years later, production of this new model signals the beginning of a new era of innovation, passion and commitment for the BMW Group in South Africa.

“Even though the global economic outlook remains uncertain, we remain true to our commitment to this production location. By the end of 2012 we plan to introduce a third shift. This will significantly increase the installed production capacity above 90 000 units. It will more than double BMW 3 Series exports from South Africa and will create 600 jobs at Rosslyn. This is again a strong signal – for our staff, our suppliers and South Africa as an industrial location.”

The South African motor industry development programme will soon be replaced by an automotive production and development programme. The latter will focus on production incentives that calculate benefits on the basis of actual local production value (local content), and not on material cost, as was the practice under the previous one.

Nuclear features in State’s R3.2tr project pipeline

By: Terence Creamer
22nd February 2012
TEXT SIZE A total of 43 major infrastructure projects, with an estimated combined investment value of R3.2-trillion, have been identified by the Presidential Infrastructure Coordinating Commission (PICC), which was set up last year by President Jacob Zuma to oversee the implementation of priority projects.

The list was published in the 2012 Budget Review and included projects worth R845-billion that were anticipated to be implemented over the medium-term expenditure framework period to March 31, 2015.

Included in the list is an Eskom nuclear fleet build programme, which had an associated price tag of R300-billion, well below the R1-trillion estimated in media reports. The programme is designed to deliver 9 600 MW of nuclear capacity by 2029 and is described as being in the “final stages of consideration before financial proposals can be determined”.

Ahead of the 2012 Budget, Energy Minister Dipuo Peters indicated that the team assessing the risks of the nuclear programme in light of last year’s Fukushima disaster, in Japan, would present its findings to Cabinet soon. Thereafter a decision would be made on how South Africa would proceed.

Of the projects set down from delivery over the coming three years, just under R300-billion has been earmarked for the energy sector and a further R262-billion for the transport and logistics environment. Also listed were four water megaprojects with a combined estimated investment value of more than R45-billion, housing projects worth R5-billion and telecoms initiatives worth R1.8-billion.

Along with the nuclear programme, which is listed under a heading ‘major projects in concept, prefeasibility and feasibility stages’, are a range of other energy transport, water, liquid fuels, education and hospital developments. Included in the list are several large crossborder initiatives including the Grand Inga hydroelectric scheme, as well as other hydroelectric, gas and coal developments across the region.

Other high-profile projects featuring as projects under investigation were the 5 000 MW Northern Cape solar park, the high-speed rail link between Durban and Johannesburg, the Moloto rail project, the Mthombo crude oil refinery, which is proposed for the Eastern Cape, and several Transnet projects related to raising manganese, iron-ore and coal export capacity.

Of the list of projects being implemented, Eskom’s R121-billion Kusile and R99-billion Medupi power stations featured prominently, along with the 3 725 MW renewable independent power producer programme, which is ascribed a project cost of R120-billion.

Transnet’s port and rail projects are also reflected along with the Passenger Rail Agency of South Africa’s R80-billion plan to acquire a new rolling stock fleet over the coming 20 years.

The largest water projects listed include the R16.1-billion Olifants river dam and distribution project, the R15-billion Mokolo-Crocodile water augmentation project and the R7.5-billion Lesotho Highlands second phase.

S.Africa to solicit bids for $17 bln worth of trains


CAPE TOWN Feb 28 (Reuters) - South Africa will solicit international bids for 128 billion rand ($17 billion) worth of train coaches and locomotives as early as next month, a senior transport official said on Tuesday.

Mawethu Vilana, the deputy director general for integrated transport planning at the Department of Transport, told Reuters the government would solicit bids for 7,200 train coaches and locomotives, with first delivery expected by 2015.

"We are looking at putting this thing to tender around March/April of this year," Mawethu Vilana told Reuters on the sidelines of a media briefing.

The acquisition of coaches will be divided into two 10-year batches, with 3,600 vehicles in each batch, as South Africa moves to modernise an ageing railway infrastructure.

Given the size of the order, Vilana said there would likely be more than one original manufacturer tapped to provide the coaches.

"For obvious reasons it may not be possible to have one original equipment manufacturer. You may have to look at a combination of one, two or three manufacturers," he said. ($1 = 7.5855 South African rand) (Reporting by Wendell Roelf; editing by David Dolan


http://af.reuters.com/article/southAfricaNews/idAFL5E8DS48M20120228

SA economy grows 3.2%


Pretoria - South Africa's economy expanded to a growth rate of 3.2% in the fourth quarter of 2011, Statistics SA said on Tuesday.

This was up from a revised 1.7% in the previous quarter, said Gerhardt Bouwer, executive manager national accounts at Statistics SA in Pretoria.

The largest contributors to growth were the trade industries: wholesale, retail and motor, catering and accommodation.

This was followed by the manufacturing industry and general government services.

The first preliminary estimate of growth for 2011 was 3.1%, Bouwer said.

This was an improvement on 2010's growth rate of 2.9%

http://www.fin24.com/Economy/SA-economy-grows-32-20120228

Great news, so happy to hear! Hope PRASA does still get handed to the Metro councils and hope the economy can continue to grow even faster. :)

So, how soon can we expect to see new rolling stock on the passenger side of things? Anyone know?

I mean, new stations like the ones at the stadiums, or Cape Town centrals revamp, are great, but they will only really be appreciated if we can get the level of passenger comfort up on the actual trains.

I know there are already new locomotives on the freight side of things...

I like it, nice and modern.

http://www.prasa.com/Images/PRASA-Rolling-Stock-Visualisation-001.jpg

http://www.prasa.com/Images/PRASA-Rolling-Stock-Visualisation-002.jpg

http://www.prasa.com/Images/PRASA-Rolling-Stock-Visualisation-003.jpg

http://www.prasa.com/PressRelease20120214.aspx

^^ If this can be coupled with Metro council's transit integration and control, plus additional security, we may be able to eventually have a world-class train system. :banana:

Thanks for the post! Here are some larger versions:

http://farm8.staticflickr.com/7036/6797162334_8b88b7efed_z.jpg


http://farm8.staticflickr.com/7043/6943278771_49935582a6_z.jpg


http://farm8.staticflickr.com/7050/6943279385_0e07f36082_z.jpg

shot..

SA factories enjoy jump in orders
46 minutes ago Reuters

Johannesburg - South Africa’s purchasing managers’ index (PMI) jumped to a two-year high of 57.9 in February from 53.2 in January, sponsors Kagiso Asset Management said on Thursday.

The seasonally adjusted business activity and new sales orders indices, which have the biggest weighting, drove the robust increase in February.

New sales orders, a leading indicator, and expected business conditions increased further, pointing to a supportive environment for business in the next few months.

Eurozone stuck in contraction territory

The eurozone’s manufacturing sector contracted for the seventh straight month in February, with factories in the bloc’s struggling indebted states facing some of the toughest conditions on record.

It looks increasingly possible that the 17-member eurozone is stuck in a mild recession, as new orders continue to fall and backlogs of work dry up, even in the region’s most healthy economy Germany.

Markit’s Eurozone Manufacturing Purchasing Managers’ Index rose to 49.0 last month from January’s 48.8 in line with a flash reading, but has now been below the 50 mark that divides growth from contraction since July.

“Whether the eurozone will sink back into recession in the first quarter remains highly uncertain. The periphery remains the major concern,” said Chris Williamson, chief economist at data provider Markit.

Asia improves

However, new factory orders for Asia’s manufacturing powerhouses perked up in February, easing some concerns about the global economic slowdown.

China’s factories grew more than expected in February as new export orders for big firms bounced back, according to a government PMI. The official PMI rose to 51.0, above expectations of 50.7 and higher than 50.5 in January.

Private sector PMIs on Thursday pointed to some improvements in factory activity in China, India and Taiwan, although in China it also showed smaller companies lagging a rebound at larger companies.

HSBC’s China PMI stood at 49.6, a shade higher than January’s reading of 48.8, but still under the 50-point threshold demarcating expansion from contraction.

Source: Fin24 (http://www.fin24.com/Economy/SA-factories-enjoy-jump-in-orders-20120301)

Those train looks stunning...better than the underground trains in Taipei!

Taipei's trains are quite old and crappy... But Chinese subways like Guangzhou, Shanghai and Beijing are pretty amazing

no no you are wrong. I use the taipei subway everyday. Its very modern indeed; that train for CT just looks a bit prettier ;)
http://travel.network.com.tw/Tools/Tourguide/ShowPicImg.asp?pickey=4684&imgmax=400
http://wiki-images.enotes.com/thumb/a/a0/Taipei_MRT_Train_C371_3CarSet_No_3398.JPG/300px-Taipei_MRT_Train_C371_3CarSet_No_3398.JPG
the automated air rail
http://upload.wikimedia.org/wikipedia/commons/6/6d/Taipei_MRT_Train_VAL256.jpg

^^ I was also using the Taipei subways just a few weeks ago and I wasn't very impressed with their modernism, not compared to China or Hong Kong atleast. Maybe I was using older lines.

17 strategic projects prioritised by President’s infrastructure body

By: Terence Creamer
8th March 2012
Cabinet has approved the Presidential Infrastructure Coordinating Commission's (PICC’s) second ‘Infrastructure Implementation Plan’ report, which includes a framework outlining an integrated management and delivery system for 17 strategic infrastructure projects (Sips) across all three spheres of government.

The report also lists 153 project components, five supply-side challenges, including the shortages of skills and bitumen, as well as five key enablers, such as rolling stock and port charges.

It includes geographic information system mapping, job-creation projections and project planning and oversight guidelines.

Over the coming three years, some R845-billion has been budgeted for public infrastructure projects and the PICC, which is chaired by President Jacob Zuma, has been established to support the delivery of the projects.

Details of the 17 Sips were not immediately available, but it was likely that the five geographically focused projects listed by Zuma during his State of the Nation address would be included.

Among the projects listed was a plan to develop and integrate rail, road and water infrastructure, centred around the Waterberg and Steelpoort areas of Limpopo, to unlock coal, platinum, palladium, chrome and other minerals, as well as the stepped-up beneficiation of minerals.

There would also be initiatives to improve the movement of goods through the Durban-Free State-Gauteng logistics and industrial corridor by prioritising a range of rail and port improvements, supported significantly by a R300-billion investment programme by Transnet over the coming seven years.

A new ‘South Eastern node’ was also being planned for the Eastern Cape to bolster that province’s industrial and agricultural development and export capacity. Initiatives within the node would include logistics linkages with the Northern Cape and KwaZulu-Natal, the construction of a dam on the Umzimvubu river to support farming and the Mthatha revitalisation project. It would also embrace a new 16-million-ton-a-year manganese export channel through the Port of Ngqura.

An initiative was also outlined for the roll-out of water, roads, rail and electricity infrastructure in the North West, including the upgrade of ten priority roads.

A range of projects was also planned for the West Coast, including the expansion of the Sishen-Saldanha iron-ore corridor to above 80-million tons.

The Budget Review also lists Eskom’s power generation projects, the renewable energy independent power producer programme, the private open-cycle gas-turbine initiative, as well as plans to beef up the power transmission and distributions networks.

Transnet rail and port projects were also highlighted, along with the Passenger Rail Agency of South Africa’s plan to acquire new rolling stock over the coming 20 years.

Several roads, water, housing and telecommunications projects were also listed in the review.

Government promised that all public-sector infrastructure projects would be subjected to rigorous feasibility assessments and that the most cost-effective projects would be pursued.

Speaking at the launch of the Dube TradePort project in Durban on Thursday, Zuma said government had “decided to invest in infrastructure in an unprecedented manner”.“

To be able to build dams, power stations, bridges, roads, viable ports and railway lines and even new cities and towns, we need a single-minded approach towards a seamless infrastructure development programme over at least 20 to 30 years,” he said.

Edited by: Creamer Media Reporter

I go to Taiwan every year. Taipei subway is WAAAY Better than the one in Hong Kong and Shanghai. It's clean and efficient. No eating or drinking inside the station premises. The main lines on the Taipei subway is about 30 years old so ofcuz it doesn't look as modern as the new ones in Guangzhou or Beijing but it is definitely cleaner and efficient. I can't believe so much South Africans go to or live in Taiwan :)

I go to Taiwan every year. Taipei subway is WAAAY Better than the one in Hong Kong and Shanghai. It's clean and efficient. No eating or drinking inside the station premises. The main lines on the Taipei subway is about 30 years old so ofcuz it doesn't look as modern as the new ones in Guangzhou or Beijing but it is definitely cleaner and efficient. I can't believe so much South Africans go to or live in Taiwan :)

I've used the subways in Hong Kong, Guangzhou, Beijing, Shanghai and Taipei and I must say for me the first three were always the fastest, most efficient and the cleanest (not by much however, Taipei MRT still offers a great service)... However each to their own :)

FW de Klerk warns against ANC plans for "second transition"

THE ANC PLANS TO END SOUTH AFRICA'S HISTORIC CONSTITUTIONAL CONSENSUS

Eighteen years ago we South Africans reached agreement on the kind of country we wanted to become. After three years of difficult negotiations we agreed that we wanted a society in which the Constitution - and not the majority of the day - would be sovereign. We agreed that that Constitution should make full provision for the protection of all our fundamental rights; that we would have free and independent courts; and that we would establish a truly democratic system of government subject to the rule of law. (http://www.politicsweb.co.za/politicsweb/view/politicsweb/en/page71654?oid=284669&sn=Detail&pid=71616)

Interesting article.

Chevy Spark now built in SA
Fri, 23 Mar 2012 2:47

The first locally manufactured Chevrolet Sparks rolled off the production line at General Motors South Africa's (GMSA) Struandale plant in Port Elizabeth this week.

This represents the first time in 31 years that a Chevrolet passenger vehicle has been built at the South African plant. Mike Pearton, GMSA Vice President of Manufacturing, said a brand new multi-million rand body shop had been installed in support of the Spark.

"This modern new facility is packed with the latest technology for the production of the Spark," said Pearton.

According to Pearton, the entry level car was previously imported from Korea.

"We see Spark as an important player in the rapidly growing Chevrolet product portfolio in South Africa. Chevrolet's volumes grew by 50.3 percent in 2011 versus 2010," he said.

Furthermore, the Spark was the top performing passenger vehicle in the 2011 Synovate Product Quality Awards.

"With just 17 faults per 100 vehicles, the standard measure in vehicle quality surveys, the Spark featured ahead of even top end luxury vehicles available to South African buyers - a superb performance for this stylish small car from Chevrolet," said Pearton.

He added that quality of locally manufactured products is a key focus area.

"Every year our products are awarded for their quality achievements and we continue to strive to maintain and exceed these levels."

The Spark assembly programme forms part of a R1-billion investment in three new product programmes of which the third generation Chevrolet Utility came on stream late last year.

"The sixth generation Isuzu KB goes into production the first half of 2013," he added.

http://motoring.iafrica.com/newsbriefs/785925.html

^^ YEAH! :cheers: Chevy Spark has become a very popular car in SA and probably a good move. If GM wants to make inroads in Africa, it's probably a good move to manufacture their entry level car here. Is GM's plant in the Eastern Cape? Would be awesome for them to get some good news... :)

Concerns over 'insanity' of Shell South Africa fracking plans
By Victoria Eastwood, CNN

....

According to a recent report by a South African think tank, paid for by Shell, the whole of South Africa and towns like Sutherland will get an economic boost if fracking goes ahead.

"The successful development of the shale gas reserves would result in approximately $11 billion to $30 billion contribution to the South African GDP", Rob Jeffrey from Econometrix told CNN. "In South African terms that is between three and 10% of South Africa's GDP, it is enormous. By the same token there would be a significant impact on employment."

But others believe Econometrix's employment figures have been exaggerated.

See also: Fracking in New York: Risk vs. Reward

"The aspect of the report that I most disagree with deals with the jobs numbers", Peet Du Plooy, an economist with the Trade and Industrial Policy Strategies told CNN.

"The report cites 700,000 jobs, which is more jobs than the entire mining sector combined. I can understand the motivation to cite such a high number but I don't think it is realistic."

...


700,000 jobs does seem too optimistic. Does anyone know of any plans regarding the produced natural gas? Is it going to be used domestically or exported?

http://edition.cnn.com/2012/03/23/business/south-africa-fracking-shell/index.html?hpt=iaf_t2

It was paid for by Shell.. so the report is full of complete and utter BS

Things are definately happening due to our association with the BRICS...lets hope this is only the tip of the iceberg.


Zuma boosts economic relations
Mar 28 2012 17:59 Sapa

Johannesburg - President Jacob Zuma has urged Russia and Brazil to invest in South Africa, the presidency said on Wednesday.

Spokesman Mac Maharaj said Zuma held bilateral meetings with Presidents Dmitry Medvedev of Russia and Dilma Rousseff of Brazil, at the Fourth summit of Brazil, Russia, India, China and SA (Brics) in India.

He said Zuma expressed interest in co-operating with Russia in engineering, especially with the training of South Africans in Russia.

"The president also raised interest in co-operation in mining, especially the operation of the ore line from Sishen iron-ore deposits to Saldanha harbour."

Maharaj said Russia had expressed interest in co-operating with South Africa in the construction of nuclear power plants.

South Africa's Integrated Resource Plan 2010 indicated that nuclear power should form part of the energy mix by 2030, with the first plant coming on line as early as 2023.

In his meeting with Rousseff, Zuma welcomed the growth in trade relations between the two countries.

"We are very happy with the partnership between South Africa's Airports Company [Acsa] and Invepar of Brazil, to run Brazil's most prominent international airport of Guarulhos for the next 20 years.

"More such ventures and opportunities could be created between South Africa and Brazil, to the benefit of both countries' industries," Zuma said.

He said he was happy that Brazil's largest construction company, Odebrecht, was due to establish an office in South Africa.
"This opens up possibilities for greater private sector collaboration."

South Africa also sought co-operation with Brazil in energy, to assist further diversify the country's energy portfolio, both in terms of sourcing and in the mix of energy supply.

Brazil boasts some of the world's largest oil and gas reserves. It is the second largest producer of ethanol in the world.

And just another one with quotes from our old mate, O'neill...

Brics to eye joint bank, exchange ties
Mar 28 2012 08:04 Reuters

New Delhi - The Brics group of emerging world powerhouses - Brazil, Russia, India, China and South Africa - is expected to launch plans this week for a joint development bank and measures to bring their stock exchanges closer together.

Officials say the initiatives will take time as they need to sort out details. But they herald a new level of ambition for a bloc that brings together about half the world’s people. The Middle East and energy security will also be discussed, officials say.

The Bric acronym was coined in 2001 by Goldman Sachs economist Jim O’Neill, who was searching for a catchy way to encapsulate the broader shift in global economic growth towards emerging markets. South Africa joined the grouping in 2010 so that it became Brics.

The countries held their first summit in 2009 and have been criticised since as nothing more than an empty acronym as they struggle to find common cause from four different continents with radically different economies, systems of government and competing priorities.

The most relevant announcement from this week’s meeting in India of the countries’ leaders is likely to be plans for a joint development bank in the mould of the World Bank.

The initiative would allow the countries to pool resources for infrastructure improvements, and could also be used in the longer term as a vehicle for lending during global financial crises such as the one in Europe, officials say.

Brazilian Trade Minister Fernando Pimentel told reporters in Brasilia last week that the countries would sign a deal at the summit to study the creation of the bank.

Sudhir Vyas, a senior Indian foreign ministry official, told reporters on Monday that the Brics would have to determine how the bank would be structured and capitalised. Such an ambitious project would take time, he said.

“We don’t set up a bank every ordinary day,” he said.
Five-nation stock index

A benchmark equity index derivative shared by the stock exchanges of the five Brics nations will be launched on Friday, the exchanges involved said earlier this month. They would be cross-listed, so can be bought in local currencies.

The leaders are also expected to sign agreements allowing their individual development banks to extend credit to other members in local currency, a step towards replacing the dollar as the main unit of trade between them.

A senior Indian government source said the Middle East and energy security will be high on the agenda, including Iran. The Russian ambassador in New Delhi said this week that a discussion on Syria would be among his country’s top priorities.

While the plenary session on Thursday is likely to focus on common ground, bilateral meetings could touch on more sensitive issues.

The exchange rate of China's currency has sparked protests from countries, including Brazilian manufacturers, for being undervalued. Most member countries also face a slowdown in their economies.


“For different reasons, each of the (countries) has got some serious policy issues to deal with here that will determine whether they continue down the path we got everybody so excited about,” O’Neill said. - Whahaha - that WE got everybody so excited about! Superiority complex, much? What a tool...

Despite the problems, the growth outlook is still better than in most of the developed world, meaning the Brics' clout will likely keep growing. O’Neill predicts the bloc’s total gross domestic product will be larger than the United States within three years and China’s economy alone will overtake the United States by 2027.

O'neil predicts this - Whoa! except its not a prediction so much as a common statement of fact. Honestly...

Any investment in SA's mining sector is welcome


Pallinghurst's platinum plans progress
Shares in Pallinghurst Resources jumped almost 13% on news it has joined forces with South Africa's IDC and the Bakgatla community to create a platinum "mega mine".

Author: Christy Filen
Posted: Thursday , 29 Mar 2012

JOHANNESBURG (Mineweb) -

Brian Gilbertson's Pallinghurst has joined forces with the Industrial Development Corporation (IDC) and the Bakgatla community to create a platinum "mega-mine" with a net asset value of R23bn ($US3bn).
Pallinghurst's plan to consolidate its platinum interests in order to leverage economies of scale was always on the cards but the shape and format of how it would look was unknown until today.

The deal sees the formation of a "Newco" in which the IDC has taken a 16% stake for R3.24bn (US$418mn). The Bakgatla Ba Kgafela Community has taken a 27% stake and the Pallinghurst Investor Consortium a 42% stake with the balance of 15% held by other shareholders. The Pallinghurst Investor Consortium includes amongst others, Pallinghurst Resources, Temasek (Singapore) and APG (Netherlands).

In terms of the deal the IDC will also be issued warrants that will entitle the IDC to acquire an additional 4% shareholding for R800m if exercised before the 31 December 2013 expiration date.

The uniqueness of the deal is that it has been achieved without any hedging or debt and the Newco balance sheet is purported to have a cash balance of US$500m.

Kgosi Pilane, leader of the 350 000 strong Bakgatla Ba Kgafela tribe, said that it had generated cash from land sales in order to participate in the venture.

Pallinghurst CEO, Arne Frandsen, followed up to explain that it was an amalgamation of R1bn (US$129mn) in cash from the Bakgatla tribe along with assets contributed to the venture by Pallinghurst, the Bakgatla and third party investors.The parties have also committed to forming a joint venture to investigate energy efficient downstream beneficiation opportunities.

Gilbertson emphasised the fact that the resources in Newco are shallower than 600m thereby reducing risk and costs involved in extracting the ore. Platinum mines in South Africa can be up to 2000m deep.

The consolidated mine is expected to create 9000 jobs with a life of mine in excess of 30 years and a resource base of approximately 70m platinum group metal (PGM) ounces. With targeted production of 1.1moz of PGMs per annum by 2016/17 the size of the operations would be similar to that of Lonmin.
The properties to be vended into the deal are adjacent to one another (contiguous) and are situated north of the Pilanesberg on the western limb of the Bushveld Complex.

They are the Pilanesberg Platinum Mine (the current operations of recently delisted Platmin), the Sedibelo Platinum Project and the Magazynskraal Platinum Project. Pallinghurst Resources owns stakes in both Platmin and Magazynskraal. Sedibelo is owned by Itereleng Bakgatla Minerals Resources.

The Pilanesberg Platinum Mine consists of an open-cast operation which is currently in ramp up to reach an annualised production rate of 250 000oz of PGMs in 2012 and a concentrator processing plant comprising UG2, Merensky and DMS circuits.

The mine's ramp up has been beset with problems, most notably an illegal strike in June 2011 where employees of a mining contractor illegally disrupted operations. The disruptions caused serious damage to property and mining equipment belonging to the mining contractor.

Assets on the eastern limb are also to be included in the deal. Platmin refers to these as the Mphahlele, Grootboom and Loskop projects.

The transaction is expected to be completed during the June quarter of this year the sens announcement said and that further details would be included in an information memorandum to be sent to Platmin shareholders.

Frandsen, confirmed plans to list Newco on the Johannesburg Stock Exchange as well as either on the London or Hong Kong exchanges.

Pallinghurst's share price had retreated slightly by 16h42 but was still up by 9.03% on the day at R3.38. Its annual results are due for release tomorrow.


http://www.mineweb.com/mineweb/view/mineweb/en/page35?oid=148453&sn=Detail&pid=102055

UAE-South Africa trade flourishes amid efforts to expand investments

Abu Dhabi

Trade between South Africa and the UAE is flourishing and in 2011 it was valued at close to $2 billion (Dh7.3 billion), South Africa's Ambassador to the UAE said Tuesday.
"The trade has been overwhelming. Last year, the value of bilateral trade surpassed the peak of 2008," Yacoob Abba Omar told Gulf News.
He said the UAE has become South Africa's sixth-largest oil supplier.
"We are primarily importing oil from the UAE while our exports to the country comprise mainly metal products, automotive parts, raw diamonds and gold," Omar added.
In November, South Africa-UAE diplomatic ties got a boost with the state visit of South African President Jacob Zuma to the UAE.
He met President His Highness Shaikh Khalifa Bin Zayed Al Nahyan and General Shaikh Mohammad Bin Zayed Al Nahyan, Abu Dhabi Crown Prince and Deputy Supreme Commander of the UAE Armed Forces.
Shaikh Khalifa and Zuma discussed ways to enhance cooperation and to achieve positive results.
In Dubai, His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, also received Zuma. Shaikh Mohammad at the time stressed the importance of exchanging visits between economic, trade and investment delegations from both countries.
He said this helped the private and public sectors achieve a joint mechanism to activate cooperation between the UAE and South Africa.
Discussions
Separately, Omar said in light of South Africa's Freedom Day on April 27, a round table discussion will be held at its embassy in Abu Dhabi today to discuss key moments in South Africa's development since its first elections in 1994, highlighting its key achievements as a nation and discussing its Vision 2030 plan.
The talks will also touch upon the country's main priorities for the coming years and its relationship with the UAE as a partner, which is home to a large number of South African expatriates.
The discussions will also include South Africa's achievements to date, including its joining the Brics last year and what this has meant for South Africa.
The presentation on Vision 2030 will highlight improvements in employment, infrastructure, health, trade and investment with the pledge to make South Africa poverty free by 2030.
The impact of these changes and future focus areas in the relationship with the UAE will also be discussed.

http://gulfnews.com/business/economy/uae-south-africa-trade-flourishes-amid-efforts-to-expand-investments-1.1006966

SA factory output surges in February
Apr 11 2012 13:14 Reuters

Johannesburg - Growth in South Africa’s manufacturing output outpaced expectations in February, adding to signs that domestic demand is recovering and backing the case for higher interest rates.

Factory output grew by 4.1% year-on-year in volume terms in February from a revised 2.3% in January, Statistics South Africa said on Wednesday. Economists in a Reuters survey expected growth of 2.0%.

On a month-on-month basis, production in volume terms grew by a seasonally adjusted 2.8%. It expanded 1.6% in the three months to February compared with the previous three months.

The manufacturing sector contributes about 15% of gross domestic product and is a major creator of jobs for the largely unskilled labour force in the country where unemployment has languished for years at around 20 to 25%.

“It’s a really good number, especially since the manufacturing numbers have had trouble building up steam,” Efficient Group economist Merina Willemse said.
“It shows a promising growth in this industry, supporting perhaps a more optimistic economic figure.”

The Reserve Bank has left its repo rate unchanged at 5.5% in the last 16 months to aid economic recovery after a recession in 2009, but some analysts say monetary tightening could resume at the end of the year to curb inflation.

The rand was firmer at R7.9633/$ from R7.9840 before the manufacturing data was released.

The yield on the 2015 bond dipped to 6.75% from 6.76% prior, while that for the 14-year bond was unchanged at 8.5%.

South Africa plans to spend R5.8bn over the next three years to help manufacturers affected by the global economic downturn upgrade their factories, improve products and train workers, the trade minister said this month.

Source: Fin24 (http://www.fin24.com/Economy/SA-factory-output-surges-in-February-20120411)

African growth robust as South Africa sputters – IMF

By: Reuters
17th April 2012

High commodity prices will buoy much of sub-Saharan Africa in 2012, but South Africa will continue to stumble due to its deep ties to crisis-ridden Europe, the International Monetary Fund said on Tuesday.

Growth in sub-Saharan Africa will pick up to 5.4% this year thanks to new mineral and oil production and the growth of export markets outside Europe, according to the fund'slatest world economic outlook.

But South Africa, the region's largest economy, will grow bya modest 2.7% this year, as it struggles with weakerterms of trade and a decrease in business confidence.

"Sluggish growth in South Africa may require some policysupport," the report said.

South Africa depends on Europe as a market for its highvalue-added exports, and has seen soaring unemployment, stockmarket volatility and currency depreciation, due to the eurozone's sovereign debt crisis.

South Africa's 2012 growth forecast was revised up from 2.5% in January, while a projection for regionalgrowth in 2012 was revised down modestly from 5.5%.

Many other sub-Saharan countries have benefited from limitedexposure to Europe as well as rebounding agricultural sectorsafter last year's droughts, the report said.

Oil exporting sub-Saharan countries are projected to grow by 7.3% in 2012, buoyed by Angolan oil production.

Nigeria, another major oil producer, will grow by 7.1%.

Despite the generally rosy predictions, the IMF warned of knock-on effects to African economies if Europe tumbles further.

Such a shock would likely be transmitted via South Africa,and would hit African exports, remittances, aid and private investment.

"Adverse shocks affecting South Africa can quickly spread toneighboring economies, through their effect on migrant workers'incomes, trade, regional investment, and finance," the reportnoted.

South Africa should consider further monetary easing if theslowdown continues, the report noted, as long as inflationremains low.

http://www.engineeringnews.co.za/article/african-growth-robust-as-south-africa-sputters-imf-2012-04-17

JOHANNESBURG (miningweekly.com) – The South African mining industry – a mainstay of the country’s $357-billion economy, the biggest in Africa as well as the basis of this country’s industrialisation – is at a crossroads, says Webber Wentzel partner and Africa mining and energy projects head Peter Leon, who is also the immediate past chairperson of the International Bar Association’s mining law committee.

“This is a critical time” is how Leon describes mining’s current impasse in his comprehensive article, entitled ‘Whither the South African mining industry?’, in the latest edition of the international Journal of Energy & Natural Resources Law, which the London-based International Bar Association has given Mining Weekly permission to reproduce*.

The host of the world’s largest mineral reserves, worth $2.5-trillion, is thus seen to be at a point where decisive action is necessary.

While conceding that South African mining’s precipitous decline does not create a pretty picture, Leon points out that, at the same time, the Department of Mineral Resources’ (DMR’s) new mining cadastre system and audit of rights and the prospect of significant amendments to the Mineral and Petroleum Resources Development Act (MPRDA) may well presage a significantly better future for South African mining.

But, in the meantime, the industry that distributes hundreds of billions of rands a year to suppliers, employees, communities, the South African taxman and its own mines in the form of capital expenditure – with only 7% going to shareholders – is squandering its once-impressive mineral inheritance.

Despite the longest commodities boom in history, South Africa’s output is falling and its contribution to national economic growth is flat.

South Africa is simply not exploiting its pre-eminent position, despite being nearly a trillion dollars ahead of Russia, its closest mineral resources rival with reserves worth $1.6-trillion.

A shrinking in consecutive quarters has thrown the mining sector into recession and a series of court cases has just added to the concern.

The rate of new investment growth is the lowest of any significant mining jurisdiction and negatives continue to dominate at production level, but again amidst a glimmer of hope in the form of growing State willingness to invest in mine- supporting infrastructure.

This month’s announcement by South Africa’s State transport enterprise, Transnet, that it would be spending some R100-billion in the next seven years to upgrade com- modity rail and port infrastructure – as part of its overall R300-billion seven-year programme – is a plus, but, in the same week, Statistics South Africa reported the lowest monthly mine production in nearly four years.

February production registered a 14.5% year-on-year fall, the biggest since the 16.8% March 2008 slump.
In the face of all this, investors are continuing to avoid South Africa at a time when rival mining jurisdictions remain on the ascendancy.

In lamenting the parlous state of South African mining, one needs to recall the positives of South African mining’s heyday to show what may be attainable once more.

National Planning Commissioner and former AngloGold Ashanti CEO Bobby Godsell gave a glimpse of South Africa’s former mining highpoints – and also the heart-breaking low points – at last month’s ninetieth anniversary celebrations of the University of the Witwatersrand.

South Africa, he reminded, was once a centre of thought leadership in gold and diamond mining and the place where mining of the deepest level, the narrowest vein and the hardest rock in human history was pioneered.

It was also at the forefront of a succession of metallurgical revolutions and geological advances.

Deputy President Kgalema Motlanthe – himself a former mineworker – added another glimmer of hope at last week’s Presidential Infrastructure Coordinating Commission (PICC) dialogue, which is prioritising South Africa’s northern mineral belt as one of its 17 strategic integrated projects.

The PICC dialogue took place in the same week that Transnet unveiled its R300-billion seven-year investment programme, which included plans to unlock the Waterberg coalfields, in Limpopo province.

On the sad side of mining remains the high level of fatalities, which continue to afflict South Africa, and Godsell made the point that mining’s cost to the country in blood and human lives was so great that it deserved to be commemorated at the level of the Vietnam War Memorial in Washington, which recognises each victim by name.

The Commission of Inquiry into Safety and Health in the Mining Industry, headed by judge Ramon Leon, reported in 1995 that some 69 000 people had been killed in South Africa’s mining industry in the twentieth century and one-million seriously injured, maimed and physically damaged – horrifying numbers.

Although the CEOs of South African mining companies have determined that 2013 will be the year in which South Africa’s mine safety is on a par with the mine safety in industrialised countries like Canada, the US and Australia, author of the mine-safety work, Falling Ground, Dr Philip Frankel, has expressed scepticism that the 2013 safety target will be attained, let alone sustained.

While the lack of safety continues to haunt the industry, there are many shallow and thus far safer regional mining pursuits that could create much-needed regional wealth and employment, but which are not going ahead because of the absence of investor confidence that the poor legislative environment perpetuates.

At the same time, resource nationalism is gathering apace, not only in South Africa, but, as Leon notes, in the Southern African region as a whole.

While Zimbabwe’s indigenisation regulations have made the main headlines, Zimbabwe is not the only country in the region that is presenting new investment paradigms.

Another is Namibia, whose Mining and Energy Minister, Isak Katali, intends to declare copper, coal, gold, uranium and zinc strategic minerals and thus subject to additional national protection.

This means that Namibia’s State-owned mining company, Epangelo, will in future hold exclusive exploration and mining rights to these strategic minerals and investors wishing to acquire them will have to partner the State-owned mining entity.
Free carry arrangements for the State-owned entities could well predominate because of the high cost of mining investment.

In 2009 alone, the South African mining industry found it necessary to invest R51-billion to sustain existing levels of mining and to plan for future levels of mining. In the same year, the industry paid out R25-billion in dividends to shareholders.

Had the South African government become the owner of the mines in 2009, South Africa’s National Treasury would have had to fund the difference between the capital investment and the dividend flow – R26-billion – from taxpayers’ revenue.
Moreover, that R26-billion investment would have been on the assumption that nationalisation would take place without compensation. If compensation were paid, it would be considerably higher.

While Leon describes outright nationalisation of South Africa’s mining industry as being unlikely, he sees as being likely growing activity from South Africa’s State-owned African Exploration Mining & Finance Corporation, which creates the complexity of State mining in competition with the private sector, as both player and referee, which may bring with it free carries in new rights issuances.

With South Africa’s own mine nationalisation debate still open ended, the long-awaited State intervention mining study (SIMS) of the ruling African National Congress (ANC) put a new investor consideration into the mix – resource rents tax, which J&J Group mining executive Michael Solomon calculates will render the South African mining industry uncompetitive.

The former Wesizwe Platinum CEO says that while the ANC’s 600-page SIMS document contains many positives in terms of constructive State participation, the resource rents tax, if implemented, would be debilitating, with much rent arising from mines that have low costs and very little rent arising from mines with high costs.

Lower commodity prices will squeeze rents, which is likely to result in decisions to mine higher-grade ore and to sterilise lower-grade ore.

As South Africa already has a mature industry and is mining at depth, productive capacity will be reduced, which will lower labour absorption capacity.

While SIMS and the ANC Youth League sees State intervention as creating more jobs, it will thus actually work in reverse.
As inefficiencies in the system are increased and cutoff grades rise, mines will close sooner, curtailing jobs still further, not only in mining but also in the secondary and tertiary sectors of the economy, which in South Africa’s case are well developed.

All this reinforces the need for not only regulatory certainty and administrative efficiency – neither of which are yet on offer – but also competitiveness, which the resource rents tax would take away.

In view of the bulk of modern investments being made from pension and provident funds, executives would be reckless to invest in a South Africa bereft of clear laws and policies, which have to be definite and consistently applied owing to the high risk of mining, which requires large capital outlays well ahead of actual production.

Leon makes a further point that investors are always wary of corruption in developing countries, particularly as a lack of legal certainty may allow get-rich-quick opportunists to manipulate the legal system, as well as those who regulate it, for their own ends.

Leon has reiterated many times over that the MPRDA, the Mining Charter and black economic empowerment are fraught with vague and ambiguous provisions, which has led the National Treasury to criticise South Africa’s mining regulatory and administrative regime as being both opaque and inefficient.

Because of the complexities, prospecting and mining rights take longer to process than in competitor countries.
With MPRDA ambiguities officially acknowledged, Leon wants to see gaps in the law closed.
But some see the long delay as being deliberately designed to allow this year’s ANC policy conference to deal with fundamental regulatory reform.

This prompted Leon – who began his article with comments attributed to Zhou Enlai, China’s Premier from 1949 to 1976, that it was still “too soon to say” what historical impact the French Revolution of 1789 may have – ended by quoting Charles Dickens on the same subject:

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going the other way.”

By now, the South African people deserve to be enjoying the best of times from their resources endowment, which requires enormous investment to turn to proper account.

• Leon's article was first published in the Journal of Energy & Natural Resources Law, Vol 30 No 1, March 2012, and is reproduced by kind permission of the International Bar Association, London, UK. ©International Bar Association.

http://www.miningweekly.com/article/critical-time-for-south-africas-mining-industry-leon-2012-04-20-2

Nominal Gdp SSA 2010_2017. IFM

http://www.imf.org/external/pubs/ft/weo/2012/01/weodata/weorept.aspx?pr.x=80&pr.y=3&sy=2010&ey=2017&scsm=1&ssd=1&sort=country&ds=.&br=1&c=614%2C666%2C638%2C668%2C616%2C674%2C748%2C676%2C618%2C678%2C622%2C684%2C624%2C688%2C626%2C728%2C628%2C692%2C632%2C694%2C636%2C714%2C634%2C716%2C662%2C722%2C642%2C718%2C643%2C724%2C644%2C199%2C646%2C734%2C648%2C738%2C652%2C742%2C656%2C746%2C654%2C754%2C664%2C698&s=NGDPD&grp=0&a=

So Angola is now the 5th largest economy after South Africa, Nigeria and Egypt and Algeria. It has overtaken Morocco! Wow, phenomenal turnaround.

But how pathetic is Madagascar? How corrupt and useless must that government be to have such a miserable economy, with all they could have? The leaders should be locked away!

And it seems after all the talk, Nigeria still has a looong way to go to challenge South Africa as the leading economy in Africa. They are just over half the size of our economy, and that is all tied to oil.

Yes, but they calculate their GDP on a 1990 base.. They are supposed to update that, which will boost their numbers alot..

So...what? The figures are wrong? Is Nigeria not capable of getting a correct figure for its own GDP? Surely if it was wrong, they would want the IMF and others to know about it?

So Angola is now the 4th largest economy after South Africa, Nigeria and Egypt! Wow, phenomenal turnaround.

But how pathetic is Madagascar? How corrupt and useless must that government be to have such a miserable economy, with all they could have? The leaders should be locked away!

And it seems after all the talk, Nigeria still has a looong way to go to challenge South Africa as the leading economy in Africa. They are just over half the size of our economy, and that is all tied to oil.

^^Angola is the fifth bigger economy in Africa. The fourth is Algeria. Concerning Madagascar, the political instability, the illiteracy and the economic dependence of country towards France are factors of this delay. And finally, concerning Nigeria, the oil represents only 15 % of the gross domestic product, the agriculture, the telecommunications sector, the sector of details, The banking sector are the first contributor of the economic growth of Nigeria.

So...what? The figures are wrong? Is Nigeria not capable of getting a correct figure for its own GDP? Surely if it was wrong, they would want the IMF and others to know about it?


The numbers aren't wrong, they are just under estimated.. We'll see what happens when they sort that out, but they can easily surpass S.A. once it's revised.

So they wrong, in other words!
How is it that all the other figures are correct, but somehow the IMF and other major international economic institutions have 'underestimated' Nigerias GDP?

Is Nigeria that desperate to be the leading economy in Africa that they are fiddling the figures?

What does desperation have to do with anything

Nigeria is definitely already the leading economy in Africa in my opinion (The reason I say it is an opinion, is because it is not openly verified - but the reality is - it is not an opinion but a fact) and what differences does that make to the development of South Africa.

Once you have considered the 2008 or later market prices and the size of the Nigerian informal sector one will realize that the Nigerian economy is the largest in Africa and even without the informal sector it will be the largest within 2 or 4 years. The informal sector is the majority of Nigeria's economy and anybody that has lived in Nigeria or conducted business in Nigeria is well aware of this - the size of the small businesses and the record of transactions and the engagement with the formal institutions is not widespread.

In terms of market prices, well the Nigerian economy has changed moreso in terms of structure the last 20 years than other African countries including South Africa. The vital industries have changed and the economy is actually still changing as I type this. Mining and tourism in 3-5 years time for example will be vastly different from the situation at present...so it is not even a change that occurred, it is a change that is occurring, but I will not go into extra detail.

This does not really concern South Africa and is not a matter of pride or dick measurement. If it concerns South Africans then obviously they are the ones that see the title as a matter of pride.

The issue, the importance of rectifying the data is an issue that will have vast investment implications and affect the management of the Nigerian economy.

So to properly market and run our economy, we actually do need to rectify the GDP. It is not cosmetic, it is actually necessary.

Diggerdog,

I think that the economy of Nigeria began to transform itself since the advent of the democracy in 1999. The economy liberalized and several sectors formerly non-existent as telecommunications and sector of the (formal) detail developed.

Sincerely, I think that it is the economy of Kenya and of Ethiopia which are under estimated.

I wouldn't use the word form ^^ I would say transform.

We still have to develop our economy around the basis of pre 1999 and we still have those industries as the vital industries but the situation is that there has been a change in composition.

The issue in one sentence that explains why Nigeria's economy is larger than the figure that is currently listed on the IMF website.

Is that the Nigerian GDP on that website reflects the old Nigerian economy while the new Nigerian GDP will reflect the new Nigerian economy.

So South Africa is being compared to a Nigerian economy that doesn't even exist. If you go to CIA.com and you look at the economic composition, that data is wrong as well.

So all the data of the Nigerian economy floating around is inaccurate, even the census is inaccurate.

And your country is the one with most unfulfilled potential!.. Congo is rich AS HELL!!!..

No one except Nigerians themselves thinks that it is the leading economy. And all the verified, international figures indicate that it is a little over half the size of South Africa's economy!
So Tbite, you are saying everyone else has it wrong!

And tourism? Really...Nigeria is not exactly a leading light in tourism. If you are relying on that to boost your economy...

Oh and by the way, South Africa has a massive informal economy as well.

And your country is the one with most unfulfilled potential!.. Congo is rich AS HELL!!!..

DRCongo could be the country the richest in Africa, but the political instability, the bad governance, the lack of qualification are the sources of the problem.

Nigeria will inevitably be the leading economy in Africa. However, S.A. will have a very important place for many years to come as the leading business hub. S.A. is home to most of Africa's major companies, and that wont change in the near future..

Nigerias economic power will come from oil mainly.. They are still light years away from having S.A's sophisticated corporate base, stock market, etc..

DRCongo could be the country the richest in Africa, but the political instability, the bad governance, the lack of qualification are the sources of the problem.


I mean the big Congo.. I always confuse them XD.. The big Congo is by far the richest country in africa and perhaps the world.


Good governance and institutions is what they need.

I mean the big Congo.. I always confuse them XD.. The big Congo is by far the richest country in africa and perhaps the world.


Good governance and institutions is what they need.

DRC is the Big Congo
Congo Brazzaville, small Congo...

The South Africa has a western economy of type. With an economy sophisticated, the most dynamic companies to the world, the knowledge industrialist, etc. etc.

:hilarious

Nigeria was supposed to overtake South Africa by 2012/2013 compared to some forumers a while back. Now that it hasn't, they're intent on somehow making that true...whether it's real or not ;)

A rebasing is suddenly going to more than double the Nigerian economy? :lol:

Stiglitz gives nod to SA’s ambitious build plans
Nobel laureate and US economics professor Joseph Stiglitz suggests ‘carrot and stick’ to lure pension savings into development
CAROL PATON
Published: 2012/04/20 07:00:27 AM
NOBEL laureate and US economics professor Joseph Stiglitz yesterday voiced strong support for the government’s R840bn infrastructure programme, which he said could create a "virtuous circle" of investment and growth and set SA on the path to a more productive and equal society.

Prof Stiglitz, a former adviser to the Clinton administration and a former chief economist at the World Bank, is a strident critic of US and European austerity policies, which he blames for those countries’ failure to recover from the financial crisis of 2008.

At a conference on infrastructure and development convened by Economic Development Minister Ebrahim Patel in Ekurhuleni yesterday, he gave a ringing endorsement of many of Mr Patel’s policies, saying "markets alone cannot build an economy".

He also pointedly endorsed Mr Patel’s intention to direct retirement and other savings into infrastructure investment as an alternative source of financing.

Successes in Malaysia and Japan where governments had control over pension fund savings had demonstrated the potential of savings to fund development.

"There are a variety of carrots and sticks that SA should think about," he said. The government could consider tax benefits for individuals whose savings were invested in socially useful investment vehicles, or prudential rules that discouraged pension funds from investing abroad.

Public investment in infrastructure was essential for economic stimulus, especially in times of economic downturn or to act as a catalyst for development. In an economy such as SA’s, with large "unutilised capacity", the returns on infrastructure investment would be particularly high.

"By investing in infrastructure we are putting to work resources that would otherwise have been idle…. If we don’t spend money to stimulate the economy, we waste money. Not investing has a higher cost," he said. "The solution is to invest in infrastructure designed to increase production."

In the US, public investment during the Great Depression had resulted in the longest and strongest period of economic growth from the end of the Second World War to the 1970s.

The Department of Economic Development’s conference is a forum for discussion by government departments, state-owned enterprises and the private sector on the government’s renewed infrastructure drive.

Prof Stiglitz said borrowing to fund infrastructure was a sound investment for the future. Even in SA, where interest rates were not as low as in the US and Europe, "SA can borrow at a rate of return that is far lower than the return on its good projects would be".

Apart from the social returns of better infrastructure and the economic stimulus, the tax revenue collected as a result of higher gross domestic product growth "would more than pay back" the costs of government borrowing.

But, he cautioned, reaping returns on infrastructure investment depended on growth, which in turn depended on the right policies. SA would need good industrial policies that promoted new industries; good education policies to provide a skilled workforce; and good financial policies to finance entrepreneurs.

Mr Patel said a discussion on public-private partnerships was needed "to ensure we have equitable risk-sharing with the private sector. So many of our public-private partnerships have loaded risk onto the public sector."

Lydon,

How much can be estimated the part of the informal economy of South Africa in nominal Pib?

Lydon, the nigerian economy being reported isn't the one that exists. Ghana was allegedly as poor as liberia until it rebased and the truth came out. Ethiopia and kenyaneed to do the same. Sas economy is very sophisticated and thus numbers will be more accurate butnigerias is just entering that phase and still needs accurate rebasing because what are our leading industries today flat out didn't exist in 1999 which is the economy this is all based on.

So much saltiness from our South Africans in here, even if Nigeria overtakes SA as the leading economy does that suddenly mean that SA is irrelevant?. The Nigerian GDP is going to be re-based in the coming months, if it is re-based by as much as 60% (which is unlikely) then it will overtake SA this year, if by 40-50% (more likely) it will Overtake SA by 2014. The standards of living for the Average Nigerian is not going to radically improve because Nigeria is worth more than SA but FDI will increase and in turn put the country on the world map. If Nigeria succeeds the neighboring countries will start to succeed and maybe a 100 years from now SSA will be transformed.

How about we wait till, you officially fiddle with your numbers, and then have this chat.

There's already enough Nigerians in SA as it is.

Back to south African economic news now.

Question.. Is S.A. BRICS, or CIVETS? :?

SA is in the both!

How about we wait till, you officially fiddle with your numbers, and then have this chat.

There's already enough Nigerians in SA as it is.

Back to south African economic news now.

Saying that the re-basing of an economy is "fiddling with numbers" shows incredible ignorance on your part. If Nigeria is still stuck in the 90's model when the country was solely dependent on oil, doesn't it stand to reason that they should re-base it now that the telecom industry and Agriculture are playing a major role in the countries economy?. And what does Nigeria being in south Africa have to do with anything, like i said SA's relevance is not going to diminish anytime soon but it's time they accept that they are not the only players in the court.

How about we wait till, you officially fiddle with your numbers, and then have this chat.

There's already enough Nigerians in SA as it is.

Back to south African economic news now.

Fiddling with numbers??

The Nigerian economy is based on DECADES ago..... :nuts:

Ghana rebased it's economy last year.... And Nigeria is doing the same {as we speak}...

^^ :soapbox:

Putting my foot down now. We are WAY off topic now and it just continues unabated. If the Nigerians and South Africans wish to debate the comparisons between each other economies', that's fine. Just think we should move this to an off-topic conversation in the Shebeen section of SSC South Africa or Oasis in SSC Africa (although, that usually ends up going pear-shaped).

Thanks guys. :)

I guess Solow was right;economies do catch up while bigger ones slow down(or rather keep going down==> SA's FDI inflow has dropped by 70% in 2010;we are now ranked 10th(on FDI inflow in Africa) compared with our 4th place in 2009[just after Mbeki era :)]).

currently Nigaria is doing all the right things like cracking down corruption(albeit the president spends millions on refreshments) and most importantly,it has improved its admistrative requirements to start a business :applause: while SA has the 2nd highest effective tax rate in the world.

Suggested solutions for SA to keep up

Textbook solution: As the Solow growth model predicts; the only driver of sustainable growth is technological progress. therefor SA needs to start(cause it hasn't) investing in HUMAN capital through QUALITY education but I don't see the government doing that since that population does not vote for them(about 8% of the people that vote for the ANC are university or college graduates).

The ANC government also needs to have a transparent policy which helps investors make informed decisions(I dare you to explain to me our current government policy;please dont tell me about what they say tell me what they have done)==> FDI will start growing again. Suffice to say; they need to squash the debate of nationalisation during theire natonal confrence in December.

SA's current effective tax rate is at 6.2%-more than twice that of a developed nation on average and about 3-4 times that of a developing nation- which is something DTI needs to look at.

As for e-tolls; I think i'm pro that only on one condition- that it does not affect freight on purchase cause if it does it will affect the masses.why do i support it? I mean If I live in Pretoria why should I bear the cost on fixing the road that YOU use?

please kindly enlighten me if you reckon im off.

^^Good points there especially on policy trasparency and consistency. Just want to point out that the issue of a high corporate tax was due to the unique Secondary Tax on Companies(STC) that SA had, which ensured that corporates paid taxes on dividends and not shareholders as is done in most other juristrictions (sp??). This situation has been normalised by its replacement with a dividend tax in the latest budget. Thus the effective tax rate on foreign corporates which come from countries with a double-tax treaty is very much in line with international norms.

Any accountants to further clarify?

Anyways here's an article about the very same issue:

Dividend tax good news for FDI
The implementation of dividends tax has been hailed as a decisive step forward in SA's efforts to attract more foreign direct investment (FDI), a leading tax advisory firm said on Monday

http://www.businesslive.co.za/personalfinance/2012/04/23/dividend-tax-good-news-for-fdi

I guess Solow was right;economies do catch up while bigger ones slow down(or rather keep going down==> SA's FDI inflow has dropped by 70% in 2010;we are now ranked 10th(on FDI inflow in Africa) compared with our 4th place in 2009[just after Mbeki era :)]).
.

But then South Africa quadrupled its FDI inflow in 2011 to be ranked number 1 by some distance...compared to 4th in 2009!
So does that stuff the theory right up?

As long as the debate on the nationalization will continue, the FDI in SA are always go stagnated. The investors do not like the uncertainty, they like being lit well on the decisions of the governments.

I wouldn't use the word form ^^ I would say transform.

We still have to develop our economy around the basis of pre 1999 and we still have those industries as the vital industries but the situation is that there has been a change in composition.

The issue in one sentence that explains why Nigeria's economy is larger than the figure that is currently listed on the IMF website.

Is that the Nigerian GDP on that website reflects the old Nigerian economy while the new Nigerian GDP will reflect the new Nigerian economy.

So South Africa is being compared to a Nigerian economy that doesn't even exist. If you go to CIA.com and you look at the economic composition, that data is wrong as well.

So all the data of the Nigerian economy floating around is inaccurate, even the census is inaccurate.


Tbite your making too much sense here, some dullards I.E DD just don't get it. Countries frequently rebase their economies so no surprise. Nigeria still has alot of work to do, corruption, insecurity, but one can feel alot of things changing fast.

Tbite your making too much sense here, some dullards I.E DD just don't get it. Countries frequently rebase their economies so no surprise. Nigeria still has alot of work to do, corruption, insecurity, but one can feel alot of things changing fast.

Listen, we have already been warned this is off topic, so shut it! Who the fuck are you anyway, with your first post on here being an insult. Do not push your luck...I know more about economics than you could imagine...we just don't need Nigerians trying to exaggerate their importance in a South African forum.
Go and rebase your economy somewhere else.

But then South Africa quadrupled its FDI inflow in 2011 to be ranked number 1 by some distance...compared to 4th in 2009!
So does that stuff the theory right up?

No it does not; the point I was trying to convey was sustainable growth. If our FDI remains high for consercutive years it still maintain that thoery only that now we will be catching up with the developed nations. Zambia is a good example; I think they will maintain sustainable growth and increased economic development. Another example is Mauritius. check those two countries compare them to SA; I haven't done it myself but I think Mauritius is better than SA on per capita GDP if not both.

SA’s black wealth accumulation crisis
2012-04-29 10:00

Andile Ntingi and Thandeka Gqubule

South Africa celebrated its 18th anniversary as a democracy on Friday, yet wealth accumulation continues to elude blacks, who make up about 90% of the population.

Gross capital formation statistics, JSE shareholding figures and home ownership levels indicate that black people own low levels of productive assets in the economy – leading to concerns that there is a crisis in black wealth accumulation.

This means they do not have the kind of assets or capital base to create new wealth, and invest and participate sufficiently in the growth of the economy.

The figures also indicate that thus far, black wealth creation has taken place through the limited transfer of assets or shares from white to black individuals and that there has been little new value or investment by blacks in the economy.

Capital formation figures measure the value of new or existing fixed assets and are a good indicator of how much new value is invested in the economy rather than consumed.

Capital formation figures for South Africa, compiled in 2011 by the World Bank, indicate that there has been a rise in the creation of new wealth of up to 20% between 1991 and 2o11. The statistics show that the black contribution to this crescendo of output has been muted.

Gross fixed capital formation stood at 25.51% of gross domestic product in 2010. This, bar a few fluctuations – including a peak in 1976 – is a steep rise from 19.6% in 1960.

So, impressive levels of new value are being created in the South African economy, but black people still lack the ability to contribute to this as they lack the capital base to invest.

Last October, the JSE released a study that showed that blacks owned 17% of the top-100 listed companies, which represent 85% of the bourse’s total market capitalisation.

This research indicates that just over half of JSE’s black wealth is held through third-party mandated investments like pension funds. The rest of the shares accounted for as black ownership on the exchange are owned by blacks directly.

Direct ownership by blacks on the JSE was acquired through black economic empowerment (BEE) deals, which were financed through debt.

But the debt-free portion of black JSE ownership is just 1.6%.

Since wealth is the total value of what is owned minus what is owed, the net worth of black direct ownership of the JSE is significantly less than the figure indicated in the JSE research document.

The JSE’s study implies that about 83% of the country’s listed shares are owned by white South Africans and foreign investors.

According to a research paper for the Gordon Institute of Business Science written by Andile Makhunga, the levels of BEE deal flow have declined drastically.

In an interview with City Press this week, Makhunga said “the era of mega BEE wealth transfers is gone for good”.

He said there were “two main problems with this model. The first is that whereas there is more than R200 billion worth of BEE deals done thus far, valuations of the wealth created by this model have been eroded by the economic crises.”

He said the second problem was that the model simply transferred wealth to a few individuals – while in the rest of the economy, black people’s incomes were declining significantly.

Thabo Masombuka, executive director of transformation services at Siyakha Consulting, said blacks needed to change the way they amassed wealth instead of focusing on buying BEE stakes from white companies.

“We approach BEE from a minimalist point of view. The top 20 rich black South Africans
have stakes in white companies and they have rarely created wealth by starting companies from scratch.

“If blacks want to create meaningful wealth, they must start their own companies instead of buying small stakes from white companies,” said Masombuka, a former director of BEE charters and partnerships at the department of trade and industry.

Businessman Sandile Zungu – who is also the secretary-general of the Black Business Council, a mouthpiece for black business – said the state has also let black people down by failing to use its buying power or procurement capacity to put more wealth in their hands.

“We expect the state to disqualify companies that have poor BEE ratings.

“The state should say you cannot tender for certain contracts unless you have an AAA+ rating,” he said.

Fronting was seen as another wealth-creation inhibitor.

“Black people have allowed themselves to be used as fronts willingly by white companies. This has set us back,” Zungu said.

On the home ownership front, whites still rule the roost and blacks still lag behind. White people own 41% of South Africa’s property and blacks 27%, according to a study done by economic research outfit Economists.co.za.

The research also found that the wealth of whites is largely held in listed shares and houses, while almost half of all black people’s assets are houses.


The solutions

Experts’ solutions to the problem of blacks’ inability to amass wealth must be implemented by government, the private sector, and black and white investors.

These would include:

» More effective and transparent use of the procurement lever of the state to strengthen a fragile black enterprise base;

» More targeted support of the fragile manufacturing sector and a *re-examination of our exchange rate;

» More skills creation to underpin small and medium enterprise and sustainability;

» Creative solutions to the problems of access and the cost of capital;

» Development finance institutions must use different credit finance criteria and approaches from commercial banks; and

» The South African venture capital community must develop a greater appetite for risk.


http://www.citypress.co.za/Business/News/SAs-black-wealth-accumulation-crisis-20120428

I'm sorry but this is not entirely accurate, @ a household level the of wealth accumulation has been constant and rapid. Not talking abt BEE millions but steady growth in the accusition of houses, cars, equities, bonds. Anecdotally its apparent too. BTW Sandile Zungu is not a businessman, he's a rent-seeker of note, he has an incentive to rubbish every progress made by normal blk people so as to force the state to have even more onerous BEE rules, basically the subtext is that they want the stakes for free....

And the interpretation of the meaning of gross capital formation is wrong, a majority of it is done by eskom, transnet, so the value created belongs to all the people. And the PIC has R1trn in govt employee pensions, majority are black... If we accept that wealth creation is a long term project then I think we've done relatively well, @ the current trajectery there should be a universal blk middle class circa 2025 imo

Is GDP enough to pip Nigeria ahead of SA?
07 May 2012 02:40
Tim Cocks

Nigeria's plans to rebase its GDP calculations and push its economy up 40% will add fuel to its contest with SA to be Africa's undisputed leader.

“There’s more to life than GDP,” is a favourite refrain of left-leaning social commentators and environmental activists. But when it comes to geopolitics, there are few better ways of establishing dominance than by seeing whose is number one.

Nigeria plans to rebase its GDP calculations later this year, a move which insiders say will push the size of its economy up by 40%, bringing it close to South Africa’s.

The potential turnaround will add fuel to a longstanding contest between the two nations to be Africa’s undisputed leader, and eventually its voice at the United Nations, which periodically ignites rows between them.

By the end of this year, at least assuming oil prices don’t collapse, Nigeria and South Africa should be approaching par in dollar terms: $370-billion and $390-billion, respectively.

With Nigeria growing at 7% a year and South Africa at less than half that, Nigeria could be ahead in just a few years.

Unavoidable
Nigerians are hoping this will translate into more prestige on the world stage — as happened on a grander scale to China, when its GDP started dwarfing those of established world powers.

It will certainly wake investors up to the opportunities in Africa’s most populous country and biggest energy producer.

“The country becomes unavoidably on the radar for anyone looking at Africa opportunities,” said Fola Fagbule, Africa Finance Corporation vice-president for origination and coverage.

Nigeria has work to do if it wants to leverage this new profile.

In international eyes the nation remains a byword for corruption and sleaze — a perception reinforced by a recent $6.8-billion scandal over fuel subsidies.

South Africa is meanwhile seen as one of the few African destinations where the rule of law safeguards investments.

“I hope a larger GDP will increase pressure on government to do things right, to be more transparent,” said Fagbule. “More likely, we’ll see a lot of chest beating, bragging about how we are the giant of Africa — even though we do things terribly.”

Graft, diplomacy
Though governance is worsening in South Africa, it has a long way to go before it crosses places with Nigeria on the Transparency International corruption perceptions index.

South Africa has sunk 29 places in the gauge of perceived corruption since 2001, from 38th in the world to 64th last year.

But Nigeria was 143rd out of 183 places in 2011, and the sheer scale of its graft has led some analysts to ask whether government statistics on things like GDP can even be trusted.

“In Nigeria, [fuel subsidy] fraud of $6.8-billion can go on without anyone really noticing or minding or it impacting official GDP,” said Antony Goldman, head of PM consulting.

“It must have had a huge impact, and yet apparently you can’t find it in any of the data.”

Nigeria is also competing with a South Africa that has put a great deal of effort into being seen as champion for Africa and developing countries in things like trade talks — its membership in the Brics (emerging market group including Brazil, Russia, India and China) has helped boost that aim.

A bigger GDP won’t automatically help it win that contest.

Geopolitics aside, what will being Africa’s giant mean for most Nigerians? Not much. Despite one of the top economic growth rates, poverty in Nigeria has been increasing.

“In practical terms will recalculation make much difference? Possibly in diplomatic terms, showing Nigeria’s power. Will it make Nigerians feel richer? I doubt it,” Goldman said.

The limits of GDP?
Unorthadox economists like Joseph Stiglitz have long argued that GDP is “a poor measure of well being”, because it fails to capture things like health, income equality and the environment.

South Africa’s GDP per capita is six times Nigeria’s and on most counts of quality of life, it scores better. Roads are good, tap water drinkable, and the power supply usually ample even if the grid is almost stretched to capacity.

Nigeria’s roads are potholed, its water polluted and its power stations generate less than a mid-sized European city.

“In terms of economic development, Nigeria has far to go to catch up with South Africa. An increase in GDP is not going to suddenly change that,” said Standard Bank’s Samir Gadio.

Nigeria also has one of the world’s worst records on environmental protection. The Niger Delta, a labyrinth of tropical swamps home to hundreds of bird species, is a place where energy majors spill huge quantities of oil with impunity.

Frequent pipeline attacks by oil thieves leak even more.

South Africa, by contrast, has some of the toughest laws to protect its wilderness in Africa. A rhino poaching epidemic to feed East Asian demand for quack medicines may be testing its resolve. In Nigeria, though, the rhino is long since extinct. — Reuters


http://mg.co.za/article/2012-05-07-is-gdp-enough-to-pip-nigeria-ahead-of-sa

^^ Don't think Nigerians will like that article.

One must concede Nigeria is doing much better at promoting rapid growth, whether this is oil, population-size or sound-policy based is up for debate. However, one cannot escape the first-world elements of an economy that just keep S.Africa as a more comfortable African gateway and scares foreign companies & expats away from Nigeria and disincentivises basing an "African operations" HQ in a place like Lagos.

SA has a banking system ranked no.4 or more globally, the infrastructure is generally first-world to on par with decent emerging economy infrastructure. Power is tight, but now, reliable and power-stations are soon to come online to meet demand. Skilled-labour lifestyle is on par with first-world nations; one does not seek higher-order activities or traverse urban chaos or travel long-distances to find it. SA's smaller towns are also advanced, in many African countries, either only the major city/cities or capital have higher-order activities. SA cities have a very organised structure, Nigerian cities (perhaps except Abuja) are chaotic and very poorly organised. The S.A. climate is favourable, equatorial climates often scare off potential expats (exceptions do exist like Singapore).

I do foresee SA eclipsed by Nigeria in the near future in statistical economic terms, but Nigeria will need to do a lot to turn economic prowess on paper into on-the-ground economic sophistication.

^^ Just out of interest, have you got data or a research article that points to SA having the 4th "best" banking system in the world?

Well, this is an extract for the World Economic Forum - Global competitiveness report for 2012 -

South Africa moves up by four places to attain 50th position this year, remaining the highest-ranked country in sub-Saharan Africa and the second-placed among the BRICS economies. The country benefits from the large size of its economy, particularly by regional standards (it is ranked 25th in the market size pillar). It also does well on measures of the quality of institutions and factor allocation, such as intellectual property protection (30th), property rights (30th), the accountability of its private institutions (3rd), and its goods market efficiency (32nd). Particularly impressive is the country’s financial market development (4th), indicating high confidence in South Africa’s financial markets at a time when trust is returning only slowly in many other parts of the world. South Africa also does reasonably well in more complex areas such as business sophistication (38th) and innovation (41st), benefiting from good scientific research institutions (30th) and strong collaboration between universities and the business sector in innovation (26th).
These combined attributes make South Africa the most competitive economy in the region.

I know the banking system is usually ranked in the top 10 over the last 5 years, and I know it has been as high as 3rd in the world. Any way you cut it, its pretty solid.

^^ Don't think Nigerians will like that article.

One must concede Nigeria is doing much better at promoting rapid growth, whether this is oil, population-size or sound-policy based is up for debate. However, one cannot escape the first-world elements of an economy that just keep S.Africa as a more comfortable African gateway and scares foreign companies & expats away from Nigeria and disincentivises basing an "African operations" HQ in a place like Lagos.

SA has a banking system ranked no.4 or more globally, the infrastructure is generally first-world to on par with decent emerging economy infrastructure. Power is tight, but now, reliable and power-stations are soon to come online to meet demand. Skilled-labour lifestyle is on par with first-world nations; one does not seek higher-order activities or traverse urban chaos or travel long-distances to find it. SA's smaller towns are also advanced, in many African countries, either only the major city/cities or capital have higher-order activities. SA cities have a very organised structure, Nigerian cities (perhaps except Abuja) are chaotic and very poorly organised. The S.A. climate is favourable, equatorial climates often scare off potential expats (exceptions do exist like Singapore).

I do foresee SA eclipsed by Nigeria in the near future in statistical economic terms, but Nigeria will need to do a lot to turn economic prowess on paper into on-the-ground economic sophistication.

Very true.

Well, this is an extract for the World Economic Forum - Global competitiveness report for 2012 -

South Africa moves up by four places to attain 50th position this year, remaining the highest-ranked country in sub-Saharan Africa and the second-placed among the BRICS economies. The country benefits from the large size of its economy, particularly by regional standards (it is ranked 25th in the market size pillar). It also does well on measures of the quality of institutions and factor allocation, such as intellectual property protection (30th), property rights (30th), the accountability of its private institutions (3rd), and its goods market efficiency (32nd). Particularly impressive is the country’s financial market development (4th), indicating high confidence in South Africa’s financial markets at a time when trust is returning only slowly in many other parts of the world. South Africa also does reasonably well in more complex areas such as business sophistication (38th) and innovation (41st), benefiting from good scientific research institutions (30th) and strong collaboration between universities and the business sector in innovation (26th).
These combined attributes make South Africa the most competitive economy in the region.

I know the banking system is usually ranked in the top 10 over the last 5 years, and I know it has been as high as 3rd in the world. Any way you cut it, its pretty solid.

That's very impressive. I just looked up the whole report (yeah I know, how sad of me) and got to that section and indeed, South Africa is ranked 4th in the world! I am incredibly impressed that your banking system is so well regarded and stable. I wonder what has led to this.

(I was also pleased to see my adoptive country come third overall too, so it was a very interesting report to read for my own education on where I live too, haha).

^^ Don't think Nigerians will like that article.

One must concede Nigeria is doing much better at promoting rapid growth, whether this is oil, population-size or sound-policy based is up for debate. However, one cannot escape the first-world elements of an economy that just keep S.Africa as a more comfortable African gateway and scares foreign companies & expats away from Nigeria and disincentivises basing an "African operations" HQ in a place like Lagos.

SA has a banking system ranked no.4 or more globally, the infrastructure is generally first-world to on par with decent emerging economy infrastructure. Power is tight, but now, reliable and power-stations are soon to come online to meet demand. Skilled-labour lifestyle is on par with first-world nations; one does not seek higher-order activities or traverse urban chaos or travel long-distances to find it. SA's smaller towns are also advanced, in many African countries, either only the major city/cities or capital have higher-order activities. SA cities have a very organised structure, Nigerian cities (perhaps except Abuja) are chaotic and very poorly organised. The S.A. climate is favourable, equatorial climates often scare off potential expats (exceptions do exist like Singapore).

I do foresee SA eclipsed by Nigeria in the near future in statistical economic terms, but Nigeria will need to do a lot to turn economic prowess on paper into on-the-ground economic sophistication.

Totally agree with you. I think what a lot of people don't realise is that while Nigeria has a higher growth rate than SA, it has tens of millions more unemployed people than SA, and needs more than 8% growth just to break even and absorb new annual job entrants (from high school, tertiary institutions, and rural migrants to cities) into its market place, excluding tackling its historic unemployment backlogs. It is estimated that SA needs at least 6% to dent its historic unemployment levels and absorb new job entrants.

The Director of Nigeria's National Planning Commission has stated that youth unemployment in Nigeria is 60 to 70 percent, and the labor market can only absorb 10 percent of new job entrants (meaning that 90% of annual new entrants are unemployed, adding to the tens of millions of unemployed from previous years).http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/AFRICAEXT/0,,contentMDK:22157069~menuPK:258657~pagePK:2865106~piPK:2865128~theSitePK:258644,00.html Just last week, Nigeria's Minister of Youth Development declared that 67m Nigerian youth are unemployed.http://allafrica.com/stories/201205030692.html That's more than SA's entire population!! What's the benefit of having 7-8% economic growth if that does not translate to reduction in poverty and unemployment? Instead, Nigeria is experiencing worsening proverty and rising unemployment. According to Nigeria's National Bureau of Statistics, 51.6 percent of Nigerians were living below US$1 per day in 2004 but this increased to 61.2 percent by 2010,http://www.google.com/hostednews/afp/article/ALeqM5iouBBPOPTlmZsCjKKbHuGH34IUqw?docId=CNG.2272adfce3366c83cf80a2c1a0f47913.401, while the country's unemployment rate rose to 23.9 per cent at the end of 2011, up from 21.1 per cent in 2010, and 19.7 per cent in 2009.http://www.nairaland.com/805178/unemployment-rate-nigeria-hits-23.9

Last month, arguably the world's most prominent newspaper, the New York Times, published a critical report on Nigeria, focusing on its inability to rein in its alarming population growth rate, which it reports will grow from an estimated 167m currently to 300m in just 25 years time.http://www.nytimes.com/2012/04/15/world/africa/in-nigeria-a-preview-of-an-overcrowded-planet.html?_r=1&pagewanted=all The UN Secretary General's special adviser (Jeffery Sachs), warns that by 2100, Nigeria's population could be an alarming 730m!http://www.bbc.co.uk/news/world-africa-13530649 The Nigerian government is currently unable to provide services and infrastructure for its current population, let alone its projected future population.

Nigeria's 2011 *official* unemployment rate (23.9%) is roughly the same as SA's latest official rate (25.2%) (both countries have much higher unofficial rates), but Nigeria's inflation rate is double SA's (12% vs 6%), and it is extremely more politically volatile than SA (increasingly frequent violence and bombings along ethnic lines).

Yes, after its rebasing exercise, Nigeria's GDP could surpass SA's within 5 years. However, its GDP preiminence will not be matched by a comparable standard of living for its citizens for a looong time. Its market undoubtedly offers opportunities for investors, but most are put off by the country's endemic corruption, poor infrastructure, and political instability.

And if Nigeria splits along ethnic lines, as some people are calling for / predicting,http://www.africafederation.net/Biafra_Nigeria.htm based on its brewing religious war, it's GDP ranking status will be moot as the GDP of each of its parts will be a fraction of SA's. Not likely to happen anytime soon, but who can say what will be state / stability of the country a decade or two down the line, if the government doesn't manage to crush religious extremism and violent separatist elements like Boko Haram. The former Yugoslavia is a case in point.

^^ HA!!

WISHING NIGERIA TO SPLIT, AND CITING ALL SORT OF EXTREME ARTICLES.............Is that How an "African" should be thinking?
How can anyone be projecting population for 2100?? ...... no one says Nigerians will be living better than South Africans...............Why all the Negativity??............eish

Personally I hope Nigeria does boom, build great infrastructure and the rest. I am a pro-African...I want all of Africa to have its time in the sun.

I think this all comes from the media, pitting the countries against each other. Competition is healthy, but we don't need fight. We have our problems, but we can actually help each other to grow ... and in fact I know both countries are growing the business links.

When South Africa realizes 5 % of economic growth, we can be sure that there has at least a created million jobs and a reduction of the poverty, but when it is the rest of Africa that realizes 5 % of economic growth, the number of jobs is marginal, lower often at 50.000 jobs and sometimes the poverty increases even. Sad but true.

^^ Don't think Nigerians will like that article.

One must concede Nigeria is doing much better at promoting rapid growth, whether this is oil, population-size or sound-policy based is up for debate. However, one cannot escape the first-world elements of an economy that just keep S.Africa as a more comfortable African gateway and scares foreign companies & expats away from Nigeria and disincentivises basing an "African operations" HQ in a place like Lagos.

SA has a banking system ranked no.4 or more globally, the infrastructure is generally first-world to on par with decent emerging economy infrastructure. Power is tight, but now, reliable and power-stations are soon to come online to meet demand. Skilled-labour lifestyle is on par with first-world nations; one does not seek higher-order activities or traverse urban chaos or travel long-distances to find it. SA's smaller towns are also advanced, in many African countries, either only the major city/cities or capital have higher-order activities. SA cities have a very organised structure, Nigerian cities (perhaps except Abuja) are chaotic and very poorly organised. The S.A. climate is favourable, equatorial climates often scare off potential expats (exceptions do exist like Singapore).

I do foresee SA eclipsed by Nigeria in the near future in statistical economic terms, but Nigeria will need to do a lot to turn economic prowess on paper into on-the-ground economic sophistication.

The way i see it, Nigeria is the China of Africa and SA is the Japan of Africa, of-course am over-exaggerating a bit but that that's how i see them. Nigeria will completely eclipse the economy of SA in the coming decades, mainly because of its sheer workforce. Nigeria will possibly wield more political power than SA in the coming decades too (linked to its GDP) but to the outside world SA will always be more attractive, SA will always have a greater say in things, the Average SA will be better off than the Average Nigerian, SA will be more advanced, and so on and so forth. While China has eclipsed Japan's economy, Japan still remains the major voice over there (subject to debate), The Average Japanese is vastly richer than the Average Chinese, Japan is decades ahead in terms of technology compared to their giant neighbor. Obviously that will change in the coming 30 or so years but then that will mean that it took China 60 years to catch and Overtake their smaller neighbor, if it took china (which was growing at average of 8 or 9%) that long it will take Nigeria much longer.

When South Africa realizes 5 % of economic growth, we can be sure that there has at least a created million jobs and a reduction of the poverty, but when it is the rest of Africa that realizes 5 % of economic growth, the number of jobs is marginal, lower often at 50.000 jobs and sometimes the poverty increases even. Sad but true.



This is because SA has the basic infrastructure to assure such growth translates into something.. In a country like Niger, what can 5% growth mean?? Probably that some rich family is getting richer, but not much more :(

This is because SA has the basic infrastructure to assure such growth translates into something.. In a country like Niger, what can 5% growth mean?? Probably that some rich family is getting richer, but not much more :(

You are right dear friend. Regrettably!:smug:

The way i see it, Nigeria is the China of Africa and SA is the Japan of Africa, of-course am over-exaggerating a bit but that that's how i see them. Nigeria will completely eclipse the economy of SA in the coming decades, mainly because of its sheer workforce. Nigeria will possibly wield more political power than SA in the coming decades too (linked to its GDP) but to the outside world SA will always be more attractive, SA will always have a greater say in things, the Average SA will be better off than the Average Nigerian, SA will be more advanced, and so on and so forth. While China has eclipsed Japan's economy, Japan still remains the major voice over there (subject to debate), The Average Japanese is vastly richer than the Average Chinese, Japan is decades ahead in terms of technology compared to their giant neighbor. Obviously that will change in the coming 30 or so years but then that will mean that it took China 60 years to catch and Overtake their smaller neighbor, if it took china (which was growing at average of 8 or 9%) that long it will take Nigeria much longer.

Greater say in what sort of things? The quoted = delusion of granduer. Get real dude !!

Greater say in what sort of things? The quoted = delusion of granduer. Get real dude !!

:lol:zzz

SA has White people, remember??.....*cough*

:lol:zzz

SA has White people, remember??.....*cough*
What does that have to do with ANYTHING... talk about bigoted comment that adds F-all to this thread. The debate is about economic growth, not race... so stay on topic or be reprimanded.

Grasping the nettle - responding to the State of the Nation address
Wednesday, 15 February 2012
By Steuart Pennington

"Good one Mr President, but when will you grasp the global competitiveness nettle?"

"Tender-handed stroke a nettle
And it stings you for your pains
Grasp it like a man of mettle
And it soft as silk remains"

Aaron Hill 1750

Most commentators have lauded the State of the Nation address. Mondli Makhanya of the Sunday Times said, "this was by far the best performance of his tenure...but it failed to properly deal with the biggest catastrophe facing this nation, an education system that is still producing ill-equipped citizens." I agree.

Lindiwe Mazibuko of the DA, more critical, said, "the government has extensive programmes, the nation faces many trials, and our people have boundless potential – it is difficult to outline all of this in one evening as part of a consolidated vision...but what our country needed was an honest assessment and a plan of action to address it." I agree.

But both Makhanya and Mazibuko themselves don’t grasp the nettle of the importance of South Africa’s challenge in improving its Global Competitiveness ranking out of 142 countries. Neither of them mentioned it.

We know that the President’s speech focused on infrastructure improvement and the re-industrialisation of South Africa to facilitate economic activity, skills development and job creation, and that the majority of his critics focussed on what he left out or how he was preparing for Mangaung.

No mention was made by any commentator that I have read of the importance of improving our global competitiveness.

Why not?

Global Ratings

It is common knowledge that the rating agencies; Standard and Poor’s, Fitch and Moody’s rely heavily on this data as part of their ‘rating’ process. They look at the ‘whole’ country, not just various components.

Our economy is the 30th largest in the world and yet South Africa is ranked 50th on the global competitiveness table of nations. Where it not for some very poor ratings in the area of health, education and labour relations we would be placed in the top 30. Were this the case the ratings agencies would move us out of BBB (moderately susceptible) into A (somewhat susceptible) or even AA (very strong). The impact on this ‘move’ for investment is inestimable.

Anecdotally, those of us who attended "Siswe Banzi is Dead" will remember the riveting scene in the Ford assembly plant where the ‘Big Boss’ from America "just walked in and walked out and didn’t greet us" (said John Kani) "I knew then that my contribution meant nothing, that I had to resign".

If the metaphor of SA’s progress post ’94 is like a new car being assembled, it is akin to a post apartheid model with which we have made rapid progress: we have a much better economic engine; we have a constitutionally designed steering wheel; we have an independently powered gearbox and suspension; we are spending big money on the chassis and the electronics; we have upholstery that is more accessible; but - we still have two pre ’94 wheels, that of education and labour relations. They both have a slow puncture that no-one wants to repair. Somehow, we think these old pre ’94 wheels will do for the meantime, that our post ’94 car will go just fine, and compete with the other models out there. And just in case you didn’t notice we still have the old pre-’94 ‘health’ spare wheel in the boot that is pap.

Given the ambitious infrastructure improvement plans it should be noted that in the Global Competitiveness Report we fare better than most would expect.

Quality of overall infrastructure (60)
Quality of roads (43)
Quality of railroad infrastructure (46)
Quality of port infrastructure (50)
Quality of air transport infrastructure (17)
Available airline seat kms/week (24)
Quality of electricity supply (97)
Nevertheless an ambitious infrastructure development programme is something we need. It will be beneficial in many respects.

We also have 10 measures which rank in the top ten in the world. As can be seen most of these measures reflect on the competence of the private sector – and they show what we are capable of.

SA Global Competitiveness Ranking (142 countries)
Strength of Auditing and Reporting 1
Regulation of the Securities Exchange 1
Budget Transparency 1
Soundness of Banks 2
Board Efficacy 2
Availability of financial services 3
Protection of minority shareholders 4
Finance through local equity market 4
Effectiveness of anti-monopoly policy 7
But we have a significant number of measures where we rank in the bottom ten in the world – and all of them are critical contributors to improved global competitiveness (and essential components on our national assembly line), and, if I dare say, are the responsibility of government. They are our pre -’94 wheels that should be re-engineered as a matter of urgency if our post ’94 car is to compete in the global environment.

SA Global Competitiveness Ranking (142 countries)
Business costs of crime and violence 136
Business impact of TB 135
Business impact of HIV 136
Life expectancy 130
Quality of education system 133
Quality of maths and science education 138
Co-operation in labour-management relations 138
Flexibility of wage determinations 138
Hiring and Firing practices 139 And we have challenges with some of our lighting and dashboard components:
Favouritism in decisions of government officials (114);
Wastefulness of government spending (69);
Burden of government regulation (112)
Public trust of politicians (88)
So, if we are to re-industrialise competitively then surely we need to pay as much attention to education, government competence, health and labour relations as we have on infrastructure.

Re-industrialisation must mean that our global competitiveness improves across the board. Therefore:

I was surprised that no reference was made to our Global Competitiveness
I wanted our President to be tougher on teacher unions
I expected a clear statement on what the performance standards are for every school in the country and what is expected from every principal regarding improved pass rates
I was hoping that further special attention would be given to modernising our education system to adapt to our re-industrialisation needs
I wondered why little attention was given to health and our declining life expectancy
I was astounded that no reference was made to the inflexibility of our labour relations dispensation
I anticipated that more attention be given to government performance and ministerial accountability
I thought that corruption, graft, and tenderpreneurship would be dealt with in detail, particularly because much of the infrastructure plans will be the responsibility of government and will, in many instances, fall foul of these curses upon our nation.
The emphasis on infrastructure and re-industrialisation is good for all of us, but there are other aspects of the assembly line that need proper attention. If we don’t re-engineer these as a matter of urgency our new post ’94 car won’t make it through rating agency ‘quality control’ without numerous ‘re-work’ requests; it won’t be that popular with our investment ‘customers’ as they look at all the other better value for money models coming out of Africa; and the passionate and committed workers on the assembly line may just start blaming the management – who hopefully will be in their offices, ready to listen - and grasp the nettle.

Post Script

Helen Zille says "There is a growing consensus in the centre of SA politics that sustainable job-creating growth is driven by the private sector, especially small, medium and micro enterprises. The job of the state is to create an environment that will attract and retain investment, entrepreneurship and skills.

In a globalised economy, the state must ensure that the conditions exist for SA businesses to be internationally competitive. A key component of this is the provision of excellent infrastructure, including water, energy, technology, transport and roads, sewage systems etc. It is one of the key roles of the state to lead in the development of infrastructure that creates a platform for growth.

We welcome the fact that the President focused on this aspect of the state's role in increasing South Africa's competitiveness. Without this we cannot attract investment, grow the economy and create jobs.

But infrastructure is only one aspect of the state's role in increasing a country's economic competitiveness.

There are many other roles the state must play, and this is where the President's speech fell short this week."

I could not agree more.

SA's tax base moves from 5mil-10mil from '07-'11, SARS.
http://iol.co.za/business/business-news/sa-s-tax-base-doubles-1.1303433