Eish the Rand is hurting me at the moment

SA’s new R500m agency seeks to bridge the innovation chasm

By: Keith Campbell
Published: 28 Mar 08 - 9:04

In South Africa it is called the ‘Innovation Chasm’. It’s not unique to this country, but that does not make it any less of a problem. It is the gap between innovative ideas or new research, on the one hand, and new products and industries which will help grow and develop the economy, on the other. Or, if you prefer the words of the Department of Science and Technology (DST), it is “the gap between the local knowledge base and the productive economy”.

This has been a matter of concern for some time, with the idea of creating an institution to help bridge this gap being first proposed during the development of the Science and Technology White Paper in 1996. This proposal was reaffirmed in the 2002 National Research and Development Strategy. In July last year, Cabinet approved a process to create such an institution, officially dubbed the Technology Innovation Agency (TIA).

The draft TIA Bill was published in August 2007, revised in October 2007, and republished in revised form and with invitations for written submissions in December 2007. Public hearings took place in mid- and late-January 2008, and the Bill was adopted by the National Assembly early this month. (For the Technology Innovation Agency Bill see Creamer Media online publication at www.polity.org.za) Next, it goes before the National Council of Provinces for its approval, which will hopefully take place next month, and, thereafter, it will be sent to the President, for his signature, which is expected to occur in May.

“The DST is already preparing for the migration of entities to the TIA to have a smooth transition, so that the agency will be up and running as soon as possible,” assures DST director-general Dr Phil Mjwara. Indeed, to expedite the start of operations by the TIA, the DST is seriously considering appointing an interim CEO to provide direction until a permanent CEO can be appointed. Once up and running, the TIA will be expected to stimulate the development of technology-based products and services, by both public- and private-sector technology-based enterprises, thereby developing a significant technology base for the country’s economy.

It will also stimulate investment, including facilitation of early-stage venture capital and foreign direct investments, as well as promoting the development of the human capital required for innovation. It will be an interface for, and actively seek to promote, cooperation between industry, academia, government, and foreign investors. The agency will further monitor technological innovation trends both in South Africa and across the world, so that it will be able to provide accurate management information for decision-makers in all the sectors. And it will connect technology entrepreneurs and companies with opportunities that will make them more competitive.

The TIA will be a funding agency, not a research and development (R&D) agency. It will exist to fund R&D that promises, at the end of the day, to deliver commercial products and services. The entire R&D and innovation continuum can be divided into basic (or pure) research, not intended to produce commercial goods and services (although basic research often provides knowledge breakthroughs that, some decades later, result in the creation of not merely new products but of entirely new industries), applied research, technology development, and, finally, manufacturing. The TIA is intended to fund applied research and early- to midstage technology development. By that point, the technology should be sufficiently advanced and proven to attract commercially minded investors (although these might include State-owned companies and public–private partnerships – PPPs) to invest in the final stages of technology development, commercialisation, and manufacture.

“The TIA is a funding agency that will issue calls to the scientific and technological sector in general,” explains Mjwara. “It will function like the National Research Foundation (NRF), which does no research itself but funds basic research at universities. The NRF issues calls for proposals for research projects, sets milestones for the approved research projects, and receives progress reports. The TIA will do the same.” Staff within the TIA will need to have certain ‘skills sets’, such as the skills to develop, manage, and sell intellectual property (IP). “The TIA will need to be able to provide complementary skills that will assist in taking an idea and turning it into a commercialisable product,” he stresses.

At first, the TIA will manage a total of R500-million a year. “We hope to grow this over time,” he says, “in part, through accessing cofunding from international partners, in return for their gaining some benefit from the resulting innovations, including through PPPs. We should easily be able to reach a total of around R700-million, R800-million, by the fifth year of the agency’s operation. In fact, we believe we could reach R1-billion by then.”

The TIA will incorporate some existing agencies. These are the Innovation Fund and the Biotechnology Regional Innovation Centres (Brics). Hitherto administered by the NRF, the Innovation Fund is effectively a smaller-scale precursor to the new TIA. It was set up in 1999 in direct response to government’s National Research and Development Strategy, to stimulate technological innovation by investing in projects with the potential to bring social and economic benefits to the country and increase the economy’s international competitiveness. Brics are sectoral, being focused on biotechnology.
Three of them are also regional – the Gauteng- based Biotechnology Partnerships and Development, or BioPAD for short; the Cape Biotechnology Initiative; and the East Coast Biotechnology Consortium (EcoBio). The fourth is the Plant Biotechnology Innovation Centre, or PlantBio. They were created to help implement the 2001 National Biotechnology Strategy and, despite their decentralised nature, they do not work independently. Cooperation takes place among all of them.

“We are seriously considering the transfer of the Tshumisano Trust, which runs the Tech-nology Stations Programme, to the TIA,” adds Mjwara. The trust was established in 2002. The Technology Stations Programme is responsible for the Technology Transfer Stations, located at the country’s universities of technology, which exist to transfer technology to small and medium-sized enterprises (SMEs). There are 12 such stations, plus three Institutes for Advanced Tooling (IAT), spread around the country. The IATs focus on tool design, tooling technology transfer, research and innovation, to benefit SMEs in the tooling sector.

The Technology Station in Electronics and a Technology Station in Chemicals, plus the IAT:Industrial Services and Technology are hosted by the Tshwane University of Technology. The Cape Peninsula University of Technology is the location for three technology stations – in clothing and textiles, in ‘agrifood’, and in agrifood technology. The Central University of Technology has the technology station in metals and manu- facturing, while the Vaal University of Technology hosts the technology station in materials and processing technologies. The Mangosuthu Technikon is the site for a second technology station in chemicals, with the Durban Institute of Technology having the technology station in reinforced and moulded plastics. The technology station in automotive components is at the Nelson Mandela Metropolitan University, the technology station in metal casting technology is located at the University of Johannesburg, and the University of Limpopo hosts a second technology station in agrifood technology. Stellenbosch University has the IAT: Research, Development, and Innovation, and the Walter Sisulu University hosts the IAT: Tool Design and Project Management.

Another element of the TIA will be competence centres, which the agency will fund and in which the private sector companies will be able to work with the science councils on high-risk, early-stage research on innovatory, products. “This will reduce the risk to the companies concerned, which, I think, is very important,” he points out.

“We are also considering incubating a new entity, which we are calling the Public Benefit Fund, that would look at technology transfer to communities,” he reveals. “But it is not yet finalised.” The DST has been running a number of poverty alleviation projects, and the idea is that these would be consolidated into the new entity or fund. “It would also work with other science councils, and seek funds from philanthropic agencies interested in such projects,” he highlights. To give just one example of the DST’s poverty alleviation projects, the department has been running a project in Giyani, in Limpopo province, which extracts essential oils from plants. Members of the local community are involved in the collection and processing of the plants. “This is technically proven, and the essential oils produced could be useful for the perfume and other industries,” reports Mjwara. “We could see commercial plantings and the possible development of SMEs.”

The fact that the TIA will incorporate Brics means that it will inherit a focus on the biotech-nology sector. “Another sector we see as important to the country is information and communication technology (ICT),” he cites, “and we may have a sectoral fund for ICT. Biotechnology and ICT are new sectors where we can grow new industries, but proposals from any and all sectors can be brought to the agency.” But while there may be a “little bit” of focus on biotechnology and ICT, that will not apply to nanotechnology as such. There is a good reason for this – nanotechnology is going to be everywhere.
“Nanotechnology is a sector on its own regarding basic research, but its applications cut across many sectors,” he explains. “It is a cross-cutting technology and, concerning the development of new products, it will form part of all sectors, and not a separate sector.”

The TIA will be headed by a CEO and overseen by a board, composed of a chairperson, the CEO as an ex officio member, and not fewer than six, nor greater than nine, members. One of the functions of the board will be to prepare an investment framework policy and to review this policy every year. “For the TIA board, we’re looking for a variety of skills sets,” says Mjwara. “We’ll be very happy if one-third of the board could be entrepreneurs who have already taken ideas and converted them into products. We’d like to have a third from the technology development arena – people from, for example, the Council for Scientific and Industrial Research, Mintek, the Agricultural Research Council, and the Medical Research Council. One-sixth should be people who understand the management of IP locally and internationally, and one-sixth from the venture capital sector. We have people in South Africa in all these sectors; it is just a matter of whether or not they’’re available.”

Inspired by successful experiences in other countries, the TIA should create an enabling environment for the stimulation and exploitation of technological innovation. That technological innovation should, in turn, give rise to new products and services, expanding and diversifying the South African economy, thereby bringing economic and social benefits to the country. The final objective is the improvement of the quality of life of everyone in the country. “The message is that we hope to work with all stakeholders, including the private sector, where they have the ideas but have difficulty raising the funds,” concludes Mjwara. “Now, there is a new home for innovation funding.”

Eish the Rand is hurting me at the moment

Im loving it 8,15 to the greenback is great for my farm

lol not great for my holidays...

but great for my work too, mainly paid in euro's, so i rand equivalent is shooting up

R120m jobs boost for youth

Bob Kernohan BUSINESS EDITOR

A R120-MILLION boost for young job seekers in the Eastern Cape was announced yesterday when the Coega Development Corporation (CDC) said it would be recruiting for 750 posts in an apprenticeship and skills development programme.

The recruitment drive will get under way in the next two weeks as the first step in creating 2796 learnerships by 2010.

Coega recruitment and placement project manager Thobeka Gaxamba said most of the jobs would be in Nelson Mandela Bay, but others would be in East London.

“The minimum requirement for the apprenticeship is N2 level in any technical trade,” Gaxamba said yesterday.

“The successful applicants will be trained for two years.

“Applicants can apply for learnerships in carpentry, plumbing, electrical, bricklaying, welding, sheet metal working, instrumentation mechanical, fitting and turning, boilermaking, tooling, digging and die-making.

“Millwrights and diesel and instrumentation mechanics are also needed,” said Gaxamba.

An instrumentation learnership programme would also need 110 candidates, with Grade 12 including mathematics and science.

“We are also recruiting 43 candidates who will be based in East London for an electrical learnership. The minimum requirement is also Grade 12, including maths and science.”

Gaxamba said the CDC was launching the programme to counter the technical skills shortage in the Eastern Cape. “The Service Seta has provided us with funds to train and give people the technical skills lacking in this region.”

Overall, more than 1100 people will be enrolled in civil, mechanical, electrical and chemical trade learnerships by mid-year, and 400 in food and beverages learnerships.

“A total of 1900 will be required over the next few years, while 2796 learnerships will be created by 2010.”

Gaxamba said the CDC had secured close to R120-million for the skills development programme, and “the figure may increase in light of increased interest in the corporation‘s skills development centre”.

Anna Marie van Jaarsveld, chairman of the municipality‘s economic portfolio, said: “It is the best news ever. We have to equip the youth. If we don‘t, we are without a future.

“We are looking forward to reaping the benefits of this programme very shortly. It also may help in keeping well-educated and skilled youth in the Eastern Cape.”

The Hopes and Challenges of a Rainbow Nation

31.03.2008 Fourteen years after the system of apartheid gave way to a freely elected black-majority government, South Africa is enjoying its longest period of economic growth ever: 96 months and counting.

The economy has grown by approximately 5 percent per year in the past four years, adding half a million jobs last year. Successful fiscal adjustment has been one of the major achievements of the post-apartheid government. From being at the brink of a debt crisis in the early 1990s, South Africa's balanced budget is now held up as the model for responsible fiscal management in Africa. But sociopolitical reforms are also taking effect. People in informal settlements are gaining access to running water and electricity, an efficient constitutional court and a free press watch over the young democracy, and previously disenfranchised South Africans are gaining access to education and opportunity, resulting in the expansion of a new black middle class that has grown to 2.6 million South Africans.

As the country prepares to host the Soccer World Cup in 2010, the government has bold ambitions: to halve poverty and unemployment by 2014, which it aims to achieve by raising average growth rates from the current 5 percent to 6 percent from 2010 – 2014. Flushed with optimism, the country that used to be an international pariah state has become a guiding example for other young democracies in Africa.

Growth Drivers Are Shifting
South Africa's economic boom has over the past four years been driven by a surging domestic consumption from the country's growing middle class. The current consumption boom was first ignited by an expansionary fiscal policy in 1999, offering tax relief to individuals and companies, as well as additional spending on social services and infrastructure. These fiscal measures, together with rising disposable income levels, stable inflation and low interest rates, triggered a surge in domestic consumption which continues to drive the South African economy today. While the expanding domestic consumption has supported the country's economic growth, it has also had its downside: rising inflation and unsustainably high household debt levels.

On the one hand, inflation has been creeping up again over the last two years, even breaching the central bank's 3 percent to 6 percent target band in March 2007. On the other hand, debt to income levels reached precariously high levels of 80 percent in 2007, up from 50 percent in 2003, indicating that consumers are increasingly relying on credit facilities to fund their expenditures. These increases in household debt and inflation have prompted the South African Reserve Bank to raise its interest rates by 4 percent to the current 11 percent in an effort to moderate consumer spending. As consumer spending moderates due to the tighter monetary policy, we expect a surge in infrastructure investment to replace consumer spending as the primary driver of economic growth. This shift has already begun, triggered by the announcement that South Africa would host the Soccer World Cup in 2010.

World Cup Leads to Infrastructure Boom
The need for infrastructure investment is clear. A decade of underinvestment has resulted in infrastructure bottlenecks that are now curtailing exports and causing severe supply shortages in the electricity sector. The increase in electricity demand is mainly driven by thousands of previously disenfranchised South Africans moving from informal housing settlements without electricity into housing developments with electricity and running water. After 14 years of underinvestment in infrastructure, the investment ratio (investment/GDP) is beginning to rise again (page 44). The government has for instance allocated a total of 420 billion South African rand to be invested in infrastructure over the next three years.

The South African private sector is also involved. Making up 70 percent of total fixed capital investment, private companies are unloading some of the large amounts of cash they have on their balance sheets. This synchronized effort has given way to the country's first ever coordinated upswing in infrastructure investment, with total infrastructure investment growth forecast between 10 percent and 15 percent per year between 2008 and 2014. The private and public sectors are also coordinating their efforts through publicprivate partnerships. The largest and most prominent example is the building of the 23- billion-rand Gautrain high-speed commuter rail system, a project in which the public and private sectors jointly finance the costs. Similar projects are already underway, as roads, ports, airports, power stations and sports stadia are built at a furious pace ahead of the starting whistle of the Soccer World Cup 2010.

Solid Prospects With Risks
Despite much progress in South Africa, several factors do cause concern. Firstly, education. One of the worst legacies of apartheid was the inferior schooling for South Africa's black majority. Poor education still limits the social mobility of far too many South Africans. Today, 57 percent of the population lives on less than 3,000 rand (430 US dollars) a year. And although half a million jobs are created each year, unemployment remains above 25 percent and still mostly affects untrained black South Africans. The lack of skilled labor also continues to cause capacity constraints in the labor market as growing companies struggle to find skilled workers.

Another serious concern is crime. More than 18'000 people were murdered last year and 50'000 raped, giving South Africa one of the highest crime rates worldwide. Speaking to local South Africans, it seems most people have a story to tell on the pervasiveness of crime in South Africa, usually involving a home invasion or a carjacking. Equally disconcerting is the HIV/AIDS crisis, which has struck 5.5 million South Africans and continues to kill close to 1000 South Africans per day. The government has come under heavy criticism for its management of the epidemic. For too long, the official response ranged from denial of the problem to the promotion of traditional remedies like eating beetroot, garlic, lemon juice or the African potato, in efforts to combat the disease. Under much pressure, the government has made antiretroviral treatments available to 250'000 people, a figure many observers argue to be too little and too late as the number of new AIDS infections show few signs of slowing down.

No Serious Opposition to ANC Power
The biggest worry for many foreign investors is that a mature multiparty democracy has yet to emerge in South Africa. After dismantling apartheid and building the foundation for a democracy in 1994, the African National Congress (ANC) today still faces no serious electoral challenge from the small opposition parties. The main opposition party, the socially and economically liberal Democratic Alliance (DA), won only 12.4 percent of the votes in the last general election in 2004 and continues to attract only 2 percent of the black electorate. As such, the DA cannot seriously challenge the incumbent ANC, which includes a broad range of eclectic groups such as former freedom fighters, the trade unions and the South African Communist Party. After 14 years of uninterrupted power, the ANC is at risk of becoming an entrenched, complacent political institution unable to renew itself, tacitly nurturing a culture of compliance rather than one of competence. If the South African political culture is unable to free itself of the idea that the ANC is preordained to rule indefinitely, the country's democracy will be worse off.

Zuma Presidency Could Cause Rift
The recent acrimony leading up to the election of the controversial Jacob Zuma as the new ANC leader may already offer the first indications of a stronger opposition - albeit perhaps from within the ANC. If Zuma is elected president when Thabo Mbeki steps down in 2009, he may have difficulty reconciling the liberal, pro-growth economic policy the ANC has followed to date with the demands of his alliances within the party to leftwing factions such as the Congress of South African Trade Unions and the South African Communist Party. If gridlock occurs, the party may split.

Building a Pluralistic Democracy
South Africa is still a young, fragile democracy, mending its wounds after five decades of violent oppression under apartheid rule. After dismantling the apartheid structures, the next challenge the country faces will be to nurture a pluralistic democratic tradition, one in which an open dialogue of political ideas is encouraged and the space for debate broadened. In this context, South Africa will serve as a guiding example for many young democracies on the African continent. With all eyes on South Africa ahead of hosting the FIFA Soccer World Cup in 2010, Africa's economic giant has several challenges to tackle as it continues on its path of mending the social wounds of the past, while ensuring economic growth and political stability for the future.

Thanks for the article Mo, its written by a person with an open mind and I'm glad that he pointed things we know unlike those who bullshit at our country without valid facts.

SA-designed mine-protected vehicle scores another US win

By: Keith Campbell
Published: 4 Apr 08 - 0:00

The South African-designed RG33 mine-protected vehi- cle family has won yet another major contract from the US Department of Defence (DoD). Although the vehicles concerned will be manufactured in the US, millions of rands in royalties will come to Benoni-based BAE Systems Land Systems OMC (Land Systems OMC), where the RG33 family was designed and developed.

The new order is the latest in the DoD’s continuing mine-resistant, ambush-protected (MRAP) vehicle acquisition programme. With a total value of $234-million, the latest contract involves the manufacture of three RG33 4 × 4 command vehicles for the US Special Forces, 51 RG33 6 × 6 ambulance variants, and 393 RG33 6 × 6 MRAP Category II variants. Category II vehicles have multimission capabilities, including acting as lead vehicles for convoys, troop transport, ambulance, explosive ordnance disposal (EOD), and combat engineering. (Category I vehicles are intended as urban combat vehicles which can transport six people.)

Production will take place at three BAE Systems facilities in the US – at York, Pennsylvania; Aiken, South Carolina; and, Fairfield, Ohio. Deliveries will start in August and be finished by November this year.

This takes to 2 182 the number of RG33 4 × 4 and RG33 6 × 6 MRAP vehicles ordered by the DoD from BAE Systems Ground Systems division in the US. In addition, 624 of Land Systems OMC’s RG31 Mk 5E MRAP vehicles have also been acquired by the US, of which 305 were manufactured in Benoni. Local production of this batch was completed on February 27, this year.

The RG33 is a medium-weight vehicle with a gross vehicle mass of 22 t – which means it can be airlifted in a C-130 Hercules transport aircraft which is, for the Americans, a tactical aircraft – with a payload capacity of 7 t. It features a V-shaped hull of the latest design, providing enhanced protection, and is armoured against 7,62-mm machine-gun fire. Its large, armoured windows provide excellent vision for its crew and embarked troops, and the vehicle can itself mount a machine gun – fitted with an armoured but transparent shield for the gunner – or, alternatively, a remotely controlled weapons station.

Operating in a troop transport role, it can carry a driver and from 9 to 11 passengers.

However, when fitted with a robotic arm, the vehicle is more likely to be used in more specialist roles. It has a modular interior, dedicated equipment stowage space, and the power generation capacity to run electronic mission equipment and the air conditioning system (essential, not luxurious, in the desert summer). The RG33 can also be fitted with a hydraulic ramp, extra add-on armour, a 6-kW auxiliary power unit, a tail light camera, a secondary battery suite, and a thermal driver’s vision enhancer, besides other options. Because of the modular nature of its interior, the baseline RG33 can be easily adapted to fulfil a number of roles, such as infantry carrier, EOD, convoy protection, weapons carrier, utility, command and control, and communications.

The RG31 is a 4 × 4 vehicle with a V-shaped monocoque welded steel hull, and comes in armoured personnel carrier (APC), ambulance, and utility vehicle variants. In APC form, it can accommodate a driver and up to nine other troops. The utility version can carry cargo or mount weapons, such as an 81-mm mortar, or a 106-mm recoilless rifle, or a 20-mm cannon. The RG31 Mk 5 has a 205-kW powerplant. Maximum speed is 105 km/h. The Mark 5 is 6,6 m in length, has a width of 2,47 m, a height of 2,727 m, a wheelbase of 3,425 m, and a ground clearance of 0,389 m. The payload is 3 700 kg.

ya the UAE has some of them as well amd the other day saw some G6 in transport

Tata to start SA production


09/04/2008 13:33

New Delhi - India's top vehicle maker, Tata Motors, plans to make trucks and buses in South Africa, as it seeks to tap more world markets including for its low-cost Nano car, a senior executive said on Wednesday.

Tata, India's top bus and truck maker, plans to set up a manufacturing facility in Rosslyn in South Africa, Managing Director Ravi Kant said at the India-Africa Summit.

The plan for the facility, which Tata Motors acquired from Nissan Motor in 2006, was complete and the project would commence shortly, Kant said.

Tata Motors, which last month signed a deal for Ford Motor's Jaguar and Land Rover brands, planned to also start assembling pickup trucks in Senegal, where it had previously supplied completely knocked down kits of buses, Kant said.

Tata, also India's No. 3 car maker, was conducting a feasibility study for assembling semi-knocked down kits of commercial vehicles in Congo, and will start selling cars there from this fiscal year, possibly even the low-cost Nano, he said.

"Africa is a key market for Tata Motors," Kant said.

"We are supplying trucks and buses for public transport and one opportunity could be for individual transport ... Nano could fit in that market," he said, without giving details.

Nano, priced at just above 100 000 rupees, is scheduled to roll out in India later this year. Tata Motors has said it would focus on local sales for the first two-to-three years.

Even the chinese want to manufacture in this country, you just have to love South Africa

Chana looking to manufacture vehicles in SA

By: Irma Venter
Published: 10 Apr 08 - 11:12
Chinese importer Chana South Africa is investigating the possibility of local vehicle assembly, CEO Karl-Heinz Göbel said on Thursday.
Speaking at the Durban Motor Show, he said that the company was "definitely looking at manufacturing in Southern Africa - hopefully South Africa - within two years".

"We want South Africa to be our stepping stone into Africa."

Göbel said the two-year old company had to sell 20 000 units a year in South Africa and the rest of Africa to make local production viable.

Chana aimed to sell 5 000 units in the South African market this year, he said. The company sold just over 3 000 vehicles last year.

One of the driving factors for the anticipated increase in sales in 2008 would be the introduction of the Benni, Chana's first entry into the local passenger vehicle market, Göbel noted.

Unveiled at the Durban Motor show, the Benni is a small 63-kW entry segment vehicle, coming to the market with a price tag of R77 900.

Chana is best known in South Africa for its Star bakkie range.

Autohaus Gobel Grout is the South African importer and distributor of the Chana range. Chana is manufactured by Changan Automobile, in China.

"South Africa is Changan Automobile's biggest export market," said Göbel.

Changan Automobile is China's fourth-largest vehicle manufactures

Truck maker rethinks its assembly strategy as demand continues to surge

By: Irma Venter
Published: 4 Apr 08 - 0:00

Mercedes-Benz South Africa (MBSA) produced 400 trucks at its East London plant in 2000. This rather humble figure led to the decision to contract Ikhwezi Truck Tech to take over the assembly of all MBSA’s completely-knocked-down (CKD) trucks, including Mercedes-Benz, Freightliner and Mitsubishi models from 2001.

However, South Africa’s appetite for infrastructure and – by implication – trucks ensured that production numbers kept on growing, reaching 3 300 units in 2004, 5 000 units in 2006, and last year’s record of 6 300 trucks.
Now MBSA has decided to insource its commercial vehicle production again, as from March 1, to ensure that it is able to cater for increasing local demand, says MBSA Mercedes-Benz Commercial Vehi-cles divisional manager Kobus van Zyl.
The local arm of the German automotive giant will also expand its truck manufacturing capacity this year, in a R45-million investment.
MBSA expects East London truck production to grow beyond 8 000 units a year.
Van Zyl says South Africa is cur- rently the biggest CKD Mercedes-Benz truck plant outside Germany.
“Insourcing the plant offers us the opportunity to align it with what is happening at the source plant in Germany, as well as with the world-class C-Class passenger vehicle plant in East London.”
Ikhwezi Truck Tech is part of East-ern Cape-based Ikhwezi Investment Holdings, which was formed in 1997. The outsourcing contract was initially awarded as a two-year tenure in 2002, from when it was renewed on a six-month notice period.
Ikhwezi Truck Tech employees will now be transferred to MBSA.
Mercedes-Benz has assembled trucks in East London since 1962, although the company’s name changed from Car Distributors Assembly, to United Car & Diesel Distributors, to MBSA. The first Mercedes-Benz truck built in South Africa in 1962 was the LP911, the first model in the L-Series, with its rounded lines and distinctive snub nose.
“We are also investigating the viability of an increased investment in the bus production facility,” says Van Zyl.
“Public transport initiatives currently being initiated by government are stimulating demand for buses.”
It is especially bus rapid transport (BRT) systems – being rolled out in host cities ahead of the 2010 soccer World Cup – which will require a number of new, specially built buses.
“We are talking to all the players in the BRT industry on detailed bus specifications,” says Van Zyl. “We expect our first prototype BRT bus to be in the country in the first half of this year.”

MBSA is currently the seventh-largest truck market for its parent company outside Germany, and the fifteenth-largest for vans and buses.
MBSA’s commercial vehicle division posted record sales of 8 622 units in 2007, compared with the 7 095 units sold in 2006.
In general, South Africa has seen a buoyant commercial vehicle market over the last few years.
“Growth like this is not sustainable over a long period. However, we remain bullish about the market for the next three to five years.”
Supporting its position is the fact that embattled power utility Eskom requires 900 new trucks to ferry coal from the mines to its power stations, says Van Zyl.
He believes MBSA can achieve a 10% growth in sales this year, which, he expects, will flow largely from extra-heavy trucks.

Rain delays railway siding project

By: Chanel Pringle
Published: 11 Apr 08 - 0:00


http://llnw.creamermedia.co.za/articles/images/resized/43025_resized_r&h_goedgevonden1.jpg
BRIDGES Three out of the four bridges are rail bridges, which have been designed to carry 30-t axle loads


Specialist railway consulting company R&H Railway Consultants reports that the private siding project for the Goedgevonden coal mine, in Mpumalanga, has been delayed owing to abnormally high rainfall during the recent rain season.

“An exact completion date has not been finalised, yet,” says the company.

R&H Railway Consultants Project Management & Construction divisional executive Flip Gous says that the highlight of the project has been the design and construction of four bridges.

Three out of the four bridges are rail bridges, which have been designed to carry 30-t axle loads. One bridge is a rail-over-rail bridge, with the new railway crossing over the existing coal line.

A second bridge is also being constructed over a flood plain, and the third railway bridge is being constructed over the Ogies–Bethal road.

Xstrata Coal South Africa, which, along with African Rainbow Minerals, owns the Goed-gevonden colliery, appointed the firm for the design and construction supervision of a new private siding for the colliery.

The siding will take off from the third coal line, near Saaiwater station, which includes a domestic link. It will run from the Saaiwater station, cross the coal line, Saaiwaterspruit, the Ogies to Bethal road (R545) and terminate in a balloon near the proposed colliery.

The export line will consist of a takeoff turnout from the third coal line, a safety set and a running line, consisting of 60-kg/m rails on concrete sleepers in a ballast bed of 1 600 m³/km.

The balloon will be a single-line layout with a 1 to 12 turnout. The domestic link will consist of second-hand 48-kg/m rails on second-hand P2 concrete sleepers.

R&H Railway Consultants has been involved in the project since 2003 when it was first appointed to conduct the feasibility study. Gous says that, during the feasibility study, the com- pany evaluated a range of options for the construction of the railway siding, eventually identifying the preferred route, materials, and preferred construction companies and suppliers.

The railway project involves the construction of about 9,35 km of rail, which includes bulk earthworks, stormwater culverts, four bridges, plate laying, overhead traction equipment and signalling.

Throughout the process, R&H Railway Consultants interfaced with Transnet Freight Rail to obtain input and approval for the project, as Transnet Freight Rail has to give its approval to all such railway projects and the projects have to conform to its standards.

Gous explains that the railway siding takeoff will be the property of Transnet Freight Rail, while all other assets will belong to the colliery.

Following the feasibility study, the project moved into the detailed design phase. Based on the preferred route, the designs and drawings of all related disciplines were refined. The detailed design phase also involved geotechnical and hydrological studies, which directed the designs.

Six tenders were compiled in collaboration with Murray & Roberts Engineering Solu-tions, which is the leading consulting firm on the Goedgevonden colliery project. R&H Railway Consultants was responsible for the technical portion of each tender.

The construction of the civils and earthworks portion of the siding started in May last year, and will be completed by the end of May this year.

The plate-laying contract was started in February this year, and will be completed by November, while the signalling contract will be completed by the end of October this year.

R&H Railway Consultants signals and overhead traction equipment divisional executive Ryan Gould says that the signalling system contract involves the installation of equipment to ensure no conflicting movements of trains. It is a complex system with track-side colour displaying devices providing train movement information to train drivers.

The signalling system for the siding will be controlled from the existing centralised train control (CTC) office, in Ogies. The CTC office controls all trains travelling between Witbank, Ogies and Broodsnyersplaas, and the total CTC and signalling installation ensures that the trains travel on available and safe routes.

Further, the Goedgevonden project also requires additional peripheral train monitoring equipment, such as weighbridges and automatic vehicle identification.

Japanese carmarker backs SA re-entry with R106m investment

By: Irma Venter
Published: 11 Apr 08 - 0:00


Japanese car manufacturer Suzuki has returned to South Africa in a R106-million investment.

Suzuki was previously distributed in the country through General Motors (then still Delta Motor Corporation), but this arrangement ended in 2004.

US car giant General Motors has also since sold its 17% share in Suzuki, and now holds only 3% of the Japanese company.

Suzuki Auto South Africa is a joint venture between Suzuki Motor Corporation, which owns 85% of the newly formed company, and Suzuki South Africa, the importer and distributor of Suzuki motorcycles and outboard motors.

"Market research shows that there is still recognition and respect for the Suzuki automotive brand among the South African motoring public," says Suzuki Auto SA product planning and marketing manager Francois van Eeden.

"Suzuki Motor Corporation (SMC) of Japan conducted research in the South African market for a number of years before deciding that this market is a growth opportunity.

"The decision to establish a subsidiary company forms part of SMC's strategy to ensure customers receive the best possible treatment from both a vehicle purchase and after-sales perspective.

"This can only be achieved through a dedicated dealer network supported by a strong head office."

Van Eeden says Suzuki Auto SA will have its own head office at Linbro Park, in Sandton. This facility will include a parts storage facility, training centre and offices.

Dealerships are planned for all main centres, such as Johannesburg, Pretoria, Cape Town, Durban, East London and Bloemfontein and, by year-end, it is expected that at least ten dealerships will have opened their doors.

"All dealership sales and technical staff will undergo intensive training before the first vehicles are available at dealerships by mid-June," explains Van Eeden.

He says the first models to be introduced will be the Swift and SX4 model ranges in June, followed by the Jimny and Grand Vitara in September.

The company will employ roughly 45 people at its head office.

All Suzuki vehicles will be fully imported through the port of Durban.

There are no plans to establish manufacturing capacity in South Africa, notes Van Eeden.

Suzuki passenger vehicles destined for the South African market will be produced at the Kosai plant, while all other vehicles will be coming from the Iwata plant. Both these plants are situated in Shizuoka, Japan.

SMC has 31 major overseas assembly plants outside of Japan, as well as 13 overseas sales subsidiaries and affiliates.

"Internationally, the Suzuki range of vehicles has established a reputation for high quality and reliability, and they are really fun to drive too," says Van Eeden.

"Suzuki is really a mobility brand with products not only for automotive users but lifestyle applications such as motorcycles, quads and marine products."

He adds that pricing "will be competitive within segments".

"However, with exchange rate fluctuation we are reluctant to commit to conclusive pricing at this stage."

Shipping group eyes SA rail-concession opportunities

By: Irma Venter
Published: 7 Mar 08 - 0:00


Shipping and logistics group Grindrod wants a bigger slice of South Africa’s rail industry.

CE Alan Olivier says the company currently has a “small rail business – the reason being that rail forms part of the logistics chain”.

However, he adds, “we believe rail is inefficient in South Africa, and that the private sector can get involved to improve efficiencies. We hope rail concessioning comes to South Africa. It will give us an opportunity to participate in the management of the country’s rail service.

“We hope to become involved in one or two lines, adding value to the service.”
In May 2005, Grindrod acquired 50% of Port Elizabeth-based Shel-tam, which specialises in rolling stock maintenance and repairs, as well as locomotive leasing.

Grindrod freight services division MD Dave Rennie says State-owned logistics group Transnet has indicated that it may be willing to provide the private sector with access to certain railway lines – shorter than 200 km – as long as it does not impact on its own main corridor freight services, such as the coal-export line.

“We believe there is a gap to have sensible discussions. We can bring in locomotives and wagons to run a private service which will not touch Transnet’s core freight rail business. We would like to gain access to certain lines to extract efficiencies.

“We’re looking at branch lines, and providing specific solutions to industries such as the maize, sugar and forestry industries,” says Rennie.

He says Grindrod would like to make this happen as soon as possible, as the opportunities already exist, but adds that there is no timeline available on the project.

Grindrod has four divisions, namely trading, freight services, financial services, and shipping, the last encompassing the bulk of its business.

The JSE-listed logistics specialist currently has a fleet of 39 ships, of which it owns nine, with 30 chartered to the company.

Grindrod aims to expand its fleet to 51 vessels by the end of 2011, of which it will own 20.

The healthy growth in the shipping market is being driven by the continuing boom in the commodity markets.
Steel, fuel, grain and soya beans are a few examples of goods showing healthy – and still growing – demand, says Olivier.

He says a possible downturn in the traditional powerhouses of the global economy, such as the US, should not cause a slowdown in shipping demand.

“China demand is still there. India demand is still there.”

Olivier adds that the future of Grindrod’s shipping division is currently under consideration, with future unbundling, disposal, a possible merger, or international listing of the division all under consideration.

He says the timing for this may be triggered by a need for capital, or market conditions.

SA economy to rebound
Apr 15 2008 7:20AM

Johannesburg - The South African economy could be resilient and flexible enough to make a "rolling readjustment" to the negative factors in 2008 and resume its upward growth in 2009, says economics professor Raymond Parsons.
He notes that in its latest regional economic outlook for sub-Saharan Africa the International Monetary Fund (IMF) predicts that growth in the region should again average about 6.5% this year.

"If we play our cards well, SA's economic growth could rebound next year on spending for the 2010 soccer World Cup and if the worst of the global financial crisis is over by then," says Parsons.

"Simply wringing our hands about the woes of the global economy is not helpful. Reducing vulnerability - and enhancing adaptability - remains the watchwords for economic resilience in the face of adversity," he concludes.

Parsons was speaking at a Northern Cape chamber of business function in Kimberley on Monday evening.

SA economy underpowered
Feb 20 2008 7:43AM

Johannesburg, South Africa - South Africa is sitting on gold, platinum and other minerals that are selling at record prices on world markets, yet its economy is, quite literally, underpowered.
The rand, the worst performing currency this year, has lost 12% against the dollar in the past month since the country was hit with electricity shortages that kept mines from working. The rand reached a low of R7.87 to the dollar in early February.

Rising inflation and high interest rates coupled with political uncertainty has also made investors increasingly jittery about the country's economic outlook. This month, analysts revised growth forecasts downwards from an expected 5% for the fourth consecutive year to 3.9%.

President Thabo Mbeki, who has presided over the country's economic growth, steps down next year and is likely to be replaced by new leader of the ruling African National Congress, Jacob Zuma who faces charges of corruption, money laundering, fraud and racketeering.

"General business confidence in the economy has suffered," said economist Iraj Abedian with Pan-African Capital Holdings, a financial services and investment company. "Market uncertainty is weighing on the value of the rand."

Mining companies, including some of the world's largest gold and platinum producers, were forced to shut down for five days last month after the state electricity supplier, Eskom, could not provide a steady source of power.

Damper put on growth

Demand for electricity in the buoyant economy has outstripped supply. The government has acknowledged it failed to heed a 1998 Eskom warning that new power generation capacity would be needed.

Mines are now receiving 90% of their normal power supply, a situation which is expected to last the next four years.

The power shortage has caused losses in production with AngloGold Ashanti Ltd. saying stoppages in January cost it 200 000 ounces. The company, Africa's biggest gold miner, expects production to be down a further 20 000 ounces this year at present electricity supply rates.

Harmony Gold said on Friday: "In the light of Eskom's electricity supply disruptions and with mines operating only at 90% of Harmony's previous power supply, the company's production for the March 2008 quarter will decrease."

The slowdown in production has sent already high metal prices soaring. And South Africa can't benefit because it's not exporting.

High interest rates of 11% - introduced by the Reserve Bank to curb inflation - have helped reduce consumer debt but have also put a damper on economic growth and further cooled foreign investment in South Africa.

Lack of confidence

This capital outflow has caused further concern about South Africa's large current account deficit and further weakened the rand. The deficit, which reached a 25-year-peak of 8.1% during the third quarter of 2007, has been funded by foreign buying of local stocks and bonds.

"It is difficult to see how South Africa is going to get out of this in the short-term," said economist Mike Schussler of T-Sec, an investment holding company. "If you are investing in a country you want high growth to give you a return, especially in equities. South Africa needs that money. But investors are looking elsewhere.

Schussler believes economic growth will slow to less than 2%.

"There is no way the South African economy will have the growth it has had in the past three, four years. We were well positioned in emerging markets but not anymore," he said.

Timing off

"At a time when the global economy is going through a slowdown phase - a recession in the US and stress in financial markets in other industrialised countries - risk aversion is great and investors are already more circumspect about investing in emerging countries. Then comes South Africa with its infrastructure problems brought to light by the power crisis," he said.

In his recent state-of-the-nation address, President Mbeki sought to reassure local and foreign business communities. "I am convinced that the fundamentals that have informed our country's forward march in the last 14 years remain in place," he said.

His potential successor, Zuma, has repeatedly emphasised that he does not plan to radically change South Africa's economic policies.

However, Mercier said there was still some concern about the possible changes next year's elections could bring, particularly if there is a change in those in charge of the economic ministries.

"Even though we are hearing the messages that policies will not change, let's see what happens when the new government comes in," he said. "This is a period of transition."

this is why, we need to sort out Zimbabwe which is a pain in the ass. I don't understand all this fumbling around by Mbeki and co as Zimbabwe is weighing heavily against sentiment.

this is why, we need to sort out Zimbabwe which is a pain in the ass. I don't understand all this fumbling around by Mbeki and co as Zimbabwe is weighing heavily against sentiment.

I agree this has been the worst year since 1994. The global mortgage crisis, Eskom, double digit inflation, and Zimbabwe have caused the economic downturn in South Africa to become worse and I am afraid that we will see five more years of lackluster economic growth as the end is not in sight.

2008/2009 draft budgets for SA's 3 major metros have been published. Interesting shift in ranking order.

1. JHB - R26 billion
2. Durban - R23.4 billion
3. Cape Town - R19.8 billion

Transnet will still raise R37bn for R80bn capex plan, despite world-market ]jitters

By: Terence Creamer
Published: 23 Apr 08 - 11:04


State-owned freight logistics group Transnet still planned to raise about R13,7-billion on the local and international capital markets during its 2008/9 financial year, as part of a bigger R37-billion, five-year capital-raising exercise, despite the considerable tightening in credit associated with the growing risk aversion in the wake of the US subprime debacle.

Speaking at a media briefing in Johannesburg, on Wednesday, CEO Maria Ramos, who has a strong public-finance background having previously served as DG in South Africa's National Treasury, said that the bulk of the money would be raised in the domestic market, but added that the group would continually review its strategy in light of any new international market developments and the global credit crunch.

She acknowledged that any debt raising would be more complex and difficult than it might have been a year ago, given the growing risk aversion globally.

But she insisted Transnet, which had a good local and international track record and whose credit rating had improved materially over the past few years, should be favourably positioned relative to other companies seeking to raise capital.

INFRASTRUCTURE COMPANIES BETTER PLACED THAN MOST
Ramos added that infrastructure companies, in general, were more likely to attract global investor interest, reporting that potential investors still demonstrated a strong appetite for Transnet business at a meeting she attended in the UK last week.

Transnet was also convinced that its balance sheet was now robust enough to withstand higher gearing levels, and that even after raising the R37-billion its self-imposed debt: equity ceiling of 50% would not be breached.

The bulk of the capital would be raised over the next three years, with R13,7-billion pencilled in for the current financial year and R10-billion for 2009/10, before tapering off to about the R3,5-billion to R4-billion levels in the two subsequent financial years.

In 2007/8, the group issued its first two bonds for R2,5-billion.

PROJECTS ADVANCING
The R37-billion would be used to fund part of an R80-billion capital expansion of Transnet's rail, port and pipeline businesses - around R47-billion of this had been allocated for growth projects and the R33,7-billion balance for replacement capital.

The rest of the funding would be raised funds generated internally, with Ramos stressing that the group would continue to seek to grow its relatively low share of the overland freight market. In fact, the group current only had 21% of the share of overland freight generated between Gauteng and the Durban Container Terminal.

The group would spend over R38-billion between 2008/9 and 2012/13 on its freight rail business; some R16,4-billion on harbour infrastructure over the same period; another R9,6-billion on port-operations equipment and infrastructure; and nearly R12-billion on upgrading its fuel pipeline from Durban to Gauteng.

Making up the balance of the five-year capital plan was R2,3-billion for the group's rail-engineering unit and another R2,1-billion for support services, including information technology and business intelligence systems.

During the 2007/8 financial period, which ended on March 31, Transnet spent a record R16-billion on capital projects and was budgeting R19-billion for the current year. Peak expenditure of R23-billion was planned for the 2009/10 financial year. Thereafter, the group's spending should decline to R18,8-billion in 2010/11, R12,2-billion in 2011/12 and R6,3-billion in 2012/13.

However, Ramos stressed that it was continuing to model (with the help of the University of Stellenbosch) South Africa's rail, port and pipeline infrastructure needs against various growth variables and that the other projects could be added at a later stage. She also did not discount the possibility of rescheduling certain projects should demand be negatively affected by the current energy crisis.

"We are working closely with Eskom in a bid to improve our energy efficiency and to minimise the effects of power outages on the business," she stressed, adding that it would also be working with its customers to assess the potential impact of freight volumes.

She hinted to the fact that slower economic growth in South Africa could well dampen volume growth and, thus, stressed the need for the group to improve its availability, reliability and productivity in order to improve the competitiveness of its offering relative to the road-freight industry.

SA's plans to host SKA radio telescope progressing

By: Keith Campbell
Published: 23 Apr 08 - 15:51


South Africa's prototype development programme, in support of the country's bid to host the international Square Kilometre Array (SKA) radio telescope project, MeerKAT, is progressing well, despite the engineering and prototyping being on tight time scales.
This was revealed at a press conference by the Department of Science and Technology (DST) and the South Africa SKA office on Wednesday.

A full experimental system for MeerKAT has been commissioned at the Hartebeeshoek radio astronomy observatory, west of Pretoria. In addition, a small seven-dish array has been deployed at the South African Astronomical Observatory in Cape Town.

The R900-million MeerKAT will be constructed in the Karoo, in the Northern Cape, and should be commissioned by 2012.

The acquisition of 14 000 ha of land has been finalised. The civil works are progressing well, they include the construction of data transport network, power connection, roads, and other facilities. The civil works are being executed in conjunction with the Northern Cape local government. The site will be ready to receive the first dish by October this year.

MeerKAT will be composed of a number of 12-m diameter dishes. The prototype array will have seven of these dishes, while the final MeerKAt will have 80 such dishes.

Should South Africa win the bid to host the €1,5-billion SKA, MeerKAT would form the core of the giant international instrument, which will be composed of 3 000 dishes, plus a central aperture array. Should the SKA be based in Australia (the other country shortlisted to host the instrument), MeerKAT would remain one of the most important radio telescopes in the world.

South Africa has also been negotiating with other African countries about their becoming partners in the SKA programme and hosting outstations of the SKA radio telescope. These countries are: Namibia, Botswana, Mozambique, Mauritius, and possibly Madagascar, Kenya and Ghana.

In a seminar that was concluded on Wednesday, an agreement was reached in principle with all these countries to establish bilateral agreements with South Africa, and to implement radio astronomy and science programmes in their countries. The agreement includes in addition to a possible hosting of remote SKA stations, the development of human capital and technology transfer programmes. All the African partner countries fully support the implementation of protected areas around SKA stations, including protection from radio interference.

The MeerKAT project includes an extensive human capital development programme that was launched in 2005. This includes a schools programme, undergraduate and postgraduate bursaries, postdoctoral awards, and international exchanges.

To date, 69 bursaries and seven postdoctoral fellowships have been awarded to 20 women and 56 men. Some 26 bursaries have been awarded to students from other African countries in various engineering and science disciplines.

Posted to the web on: 21 April 2008
Job creation sees arid region bloom


The Northern Cape is set to enjoy an investment boost that should knock on to the property market in the region, writes ANNA-MARIE SMITH

THE Northern Cape, SA’s largest yet least densely populated province in a semi-desert region, offers a wealth of minerals as well as a wide range of investment opportunities including prime property in towns such as Kimberley, Kuruman, Upington, Kathu, Sishen, Prieska, Britstown and Barkley West.

Historic Kimberley, only 175 km from Bloemfontein, is home to many museums and places of interest, including the Big Hole, a reminder of early diamond mining in the area.

Government’s move to have more diamonds cut locally is having encouraging effects on local industry. The recent establishment of the State Diamond Trader (SDT) in Kimberley is expected to create 2000 jobs and boost the region’s infrastructure — including property. Kobus van der Walt, owner of the Kimberley Aida franchise and a developer, says: “The creation of an expected 2 000 jobs will put more money in circulation and boost the already strong local demand for housing."

The STD will sell 10% of production to local diamond cutters and polishers, and will re-establish Kimberley as the country’s diamond hub, which should have a positive spin-off for the city’s property market.

Among several new developments , Kimberley will soon boast a residential apartment block within reach of middle-income earners.

Kekewich Palms, a 60-unit block in Monumenthoogte offering two-bedroom units at around R550 000 , is in the final planning stages and building is expected to begin in September. Van der Walt says the small Momento Manor townhouse off-plan development, with units priced at just under R800 000, recently sold out shortly after launch .

Another Northern Cape hive of activity is Upington, which has alternative wealth in the surrounding countryside in the form of agriculture — particularly the production of quality grapes and wine.

This region is also a viable sheep-rearing area — particularly for karakul and the previously neglected merinos.

The lesser known, yet quaint Kalahari region includes Kuruman and the mining town of Kathu, whose claim to fame is its golf course, likened to an oasis in the middle of the desert.

Wayne Rubidge, area manager of the recently established Pam Golding Properties Karoo, says: “We have extended our network to incorporate the Kalahari due to the growing demand for property from South African as well as overseas buyers."

Rubidge says that because of its hot climate, this area is increasingly popular among Scandinavians, who view it as a great lifestyle destination away from the long, cold winters of northern Europe.

A recently launched development in the area is Belle Rio Estate, consisting of 102 residential units situated near Upington. It was almost 60% sold out during the first week.

The first lifestyle development of its kind in the Kalahari, prices for freestanding plots measuring 790m² to1440m² range from R370000 to R780000 and the 43 plot-and-plan homes, varying from 130m² to 180m², are selling from R1,1m.

Upington offers a variety of amenities, including irrigation canals flowing through the residential area, as well as the trappings of modern city living in the form of a large shopping mall. Rubidge says property prices in the middle-income areas are increasing, with prices ranging from R450000 to R600000.

They start at R800000 in upmarket areas. In the exclusive suburbs, grand and spacious properties sell from R1,5m to more than R5m at the top end.

The abundant water available in the Upington area is also supplied to the numerous smallholdings, popular among those seeking a rural atmosphere.

Rustic smallholdings of about 20ha can be bought for about R500000, some with irrigation included. This area is also the largest in South Africa producing table grapes for export. Around Upington there are vineyards along the Orange River. Small fruit farms under irrigation along the Orange sell for about R1m and less.

Rubidge says farms in the region with quality soil, greater infrastructure or fashionable cultivars sell for more than R2m, while profitable export grape or nut farms with extensive irrigation and infrastructure are available in the R5m to R20m range.

Kalahari farms are very popular for game or livestock farming, depending on their location within the region. “We’ve experienced strong interest in property in this area and expect this to continue with the arrival of the summer rains," says Rubidge.

Finance24.com

Apr 23 2008 12:26PM

Greta Steyn

SA's CPIX rate breached double digits for the first time since 2003, with a shock rise to 10.1% in March from 9.4% in February, raising fears that the Reserve Bank will hike interest rates again in June.
The CPIX rate is consumer inflation excluding mortgage interest rates, and is the rate that the South African Reserve Bank (SARB) watches for monetary policy purposes. SARB has hiked interest rates by 4.5 percentage points, taking the prime overdraft rate to 15%, since its rate hiking campaign started in June 2006. This is the twelfth month running that the CPIX rate is outside of the target range.

Food and fuel were the main reasons for the year-on-year rise in the CPIX, although other factors such as housing, medical care, power, household operations, education, personal care, cigarettes and clothing and footwear also played a role.

Peak not reached?

Nedbank economist Dennis Dykes said that the peak of the CPIX rate might not yet have been reached, depending on what happened to electricity price increases later this year. Eskom has asked for a 60% tariff increase to replace the 14.2% increase regulators granted it last year. Dykes expected Reserve Bank Governor Tito Mboweni to raise the repo rate by a further 50 basis points at the bank's next meeting in June.

Standard Chartered economist Razia Khan said it was especially troubling that the inflation rate was in double digits. "We thought those days were long gone. These are shock numbers that will affect expectations negatively," she said.

She predicted that the Reserve Bank would act to raise the repo rate if further electricity price increases came through. But even if the Eskom price increases didn't come through, Khan thought it would be a difficult call for the Reserve Bank.

Food and fuel

The trouble was that most of the pressure for inflation was coming from food and fuel, and not domestic demand. "Do you really want to kill off demand, when it looks as if it's already dying?" she asked.

ETM economist George Glynos said the number was "horrific" and there was more pressure to come, as he believed that electricity tariffs would be hiked substantially. If Eskom's full 60% demand was granted, it would drive the CPIX rate to a peak of about 11.4% in about September. "This seals the case for at least one more interest rate hike in June. There could be another one in August as well," he said.

- Fin24.com

well is still low compared to Dubai which has inflation at an average of 22% p/a for the past 4 years

Eskom is to suspend scheduled load shedding from Monday

Eskom is to suspend scheduled load shedding from Monday, May 5, said the utility's chief executive officer Jacob Maroga on Wednesday.

He said: "We are seeing evidence of increased energy savings from municipalities and Eskom is optimistic that further reductions to reach our 10% savings target are possible."

Scheduled power cuts already have been suspended for this week due to the number of public holidays grouped together and the lower demand typically experienced during such times.

A team of senior Eskom executives and top officials of municipalities from around South Africa is to meet early next week to discuss the way forward in driving further energy savings to meet the national target.

This meeting is a further follow-up to the formation of the team on April 18.

Maroga said: "We have said from the beginning that load shedding is not our preferred option to achieve the 10% savings the nation needs.

"Recent savings, particularly from industry, have shown that it should be possible to achieve this objective sustainably through a concerted and committed effort by all of us,".

"This is the spirit of Eskom's engagement with municipalities and we hope that the 10% target will be met so that it will not be necessary to reinstate scheduled load shedding," he said.

However Eskom warned that if the national grid came under unexpected pressure, there might be occasions where brief periods of power cuts could be required.

we are seeing increased energy savings because everybody is on holiday!

Western Cape set for Mideast investment

By Aziz Hartley

Western Cape agriculture and tourism are among sectors set to benefit handsomely from opportunities created after a provincial government and business delegation returned from an eight-day visit to the Middle East, said Premier Ebrahim Rasool.

At Wednesday's report-back meeting on the trip, Rasool said while arrangements were under way to expose Saudi Arabian tour operators and travel agents to local tourism, some business delegates and their Arab counterparts were discussing construction, boat building and jewellery manufacturing opportunities.

He said that during their visit to Qatar, Saudi Arabia and the United Arab Emirates, it became clear these countries regarded South Africa, and especially the Western Cape, as a reliable platform to launch business ventures.

"Some of our business people are discussing opening a shared office in Jeddah to take advantage of opportunities. Cape Town Routes Unlimited will co-ordinate efforts to increase marketing the Western Cape in the Middle East.

"There was great interest to invest in our agriculture and promote exports, especially deciduous and citrus fruits and juice concentrates. Given the high regard for SA's agricultural expertise, in Saudi Arabia there is a demand for our technical and academic experts to spearhead initiatives there," said Rasool.

Other spin-offs from the visit included:

# SA's pilgrims quota to remain at 5 000.

# Talks for more frequent and direct flights from Saudi Arabia to Cape Town.

# Middle East offers to sponsor SA students to acquire scarce skills such as urban design, architecture and the petro-chemical industry.

# Tourism benefits when the Saudi soccer team uses the Western Cape as a base for the 2010 World Cup.

Rasool also said that Arab businessmen were keen to purchase local farms. Agriculture MEC Cobus Dowry said the businessmen were told about 14 farms that were for sale at an average price of R16 million.

But Dowry said the businessmen were told that things could not happen overnight. He said Arab interest in agricultural products would boost the local emerging sector and move exporters away from the European market which posed a number of difficulties.

"There are so many export opportunities. In Riyadh we met a number of people who wanted to import immediately. On the Jeddah leg of our tour, they were looking for agriculture expertise on how to use water effectively. We can help because of our expertise in that field," Dowry added.

aziz.hartley@inl.co.za

The best and worst regions to live in

Published:May 04, 2008
How we rated them

The South African Institute of Race Relations ranks South Africa’s nine provinces on more than 100 development indicators, which are grouped into five categories: economy, education, health, living conditions and crime.

Business Times selected 64 indicators on which the provinces could be fairly compared and awarded points equal to the ranking on each measure. The sum of these positions produced a ranking in each category and an overall ranking for each province. For the original SAIRR report, go to http://www.businesstimes.co.za

1. Western Cape

The Western Cape is the best place to be if you have money, but rough for those who don’t.

The province contributes 15% of national economic output, with 10% of the population. Its economic growth rate of 5.9% in 2006 was second only to Gauteng. It has the lowest unemployment rate at 23% and the highest average household income at R135029 a year.

The education system takes the laurels, though many of those who qualify head for Gauteng, so the resident population is slightly less well educated than that of Gauteng.

The healthcare system is also a national model, with the lowest staff vacancy rate, a good bed-to-population ratio and the lowest HIV infection rate, of 5.8%, this year. It has the lowest mortality figures and it is the only province with an average life expectancy of more than 60 years.

The province leads the country in the provision of water, electricity and telephones, but because so many people head to Cape Town looking for work, nearly 15% of the population still live in informal shelters.

Crime weighs heavily, however, with 61 murders per 100000 people every year and the second-highest and fastest- growing rate of armed robberies. One in every 100 homes can expect to be burgled every year and the rate is rising, not dropping. Though the Western Cape has the second-highest ratio of police to population, the crime problem is huge.

The Western Cape ranked 1st on the Business Times analysis.

2. Gauteng

Gauteng is the smallest province in terms of area only.

With one in five South Africans living there, it has the biggest population except for KwaZulu-Natal; contributes a third of GDP; and has the fastest-growing economy. A verage household income of R111000 a year is more than double the figure for last- ranked Limpopo.

Gauteng runs a close second to the Western Cape on education and housing standards, but trails on health mainly because of the high numbers and prevalence of HIV/Aids . With a third of public health professional posts vacant last year, the province battles to cope with more than 7 million people who rely on public health. The ratio of doctors to population is the fourth best in the country, but the ratio of nurses to population is the country’s worst.

Gauteng has SA’ s most highly educated population and the second-best schooling system based on matric and university entrance pass rates.

People arriving to look for work keep pressure on the housing system, but Gauteng is building houses faster than any other province and has nearly three-quarters of the population in formal dwellings.

But Gauteng’s greatest achievement is in the fight against crime, with the fastest- falling figures for murder, rape and residential burglary and the nation’s second-best performance in fighting aggravated robbery.

Gauteng ranked 2nd overall on the Business Times analysis.

3. Northern Cape

Population set the Northern Cape apart and tilts many statistics towards the positive. It is the biggest province with the smallest population.

The province accounts for just 2.2% of national output, mostly from mining, and the economic growth rate is the second-slowest, at 3.1%, when the national average was 5.1%.

Unemployment is around the national mid-range at 36%, and the average household income is low at R56310 a year.

The matric pass rate of 70% is the third highest, as is the teacher-pupil ratio, but statistics suggest that most of those who do earn matric or a higher qualification leave the province for bigger centres.

Life expectancy is the third best in the country, close to Limpopo and behind the Western Cape; child mortality is the second best and the HIV rate of 7.5% is in the best third. The ratio of doctors to patients is the best in the country and the number of hospital beds is second best, but, with two out of five health sector jobs vacant, the health service is stretched.

The province has the highest ratio of police to population and one of the lowest rates of armed robbery, but the murder rate is at the higher end of the scale and the rate of reported rapes is the worst in the country.

Living standards are relatively good with bucket toilets almost completely eradicated, but one in 10 families is still in an informal shelter.

The Northern Cape ranked 3rd in the Business Times analysis.

4. Free State

The Free State has neither the best nor the worst of anything among the five categories assessed; it is as central among the statistics as it is on the map .

With an estimated 6.2% of the population, the province contributes a fair 5.4% to national output. Unemployment is better than in four other provinces and worse than the other four at 36%, but the household income level of R60700 a year in 2006 was the third highest in the country.

The performance of the education system is in the top third, with a relatively low 8% of the people having had no education and nearly one in four having passed matric.

Only the Eastern Cape and KwaZulu-Natal have child mortality rates of more than the Free States’s 83 per 1000 live births and only Gauteng and KwaZulu-Natal are thought to have higher HIV infection rates than the 14.1% estimate for the Free State.

The province has done well on housing its people since 1994; seven out of 10 households live in a formal dwelling and nearly nine out of 10 have electricity as well as water indoors or on site.

The murder rate is relatively low at 32.2 per 100000 each year, rape is high in relation to other provinces but dropping, and most other forms of crime are around mid-range levels for South Africa. Stock theft is prevalent, though.

The Free State ranked 4th overall on the Business Times analysis .

5. Limpopo

Limpopo is the safest place to live, but probably only because the criminals have joined the migration to the richer cities. It has the nation’s lowest rates of murder, rape, armed robbery and home burglaries.

But with the country’s lowest ratio of police to population, the crime rate stubbornly resists reform.

It is one of South Africa’s poorest provinces, with an average household income of R4550 a month, and has the highest unemployment rate, at 52%. Mining is the main source of earnings and employment.

Farming, which should be picking up much of the burden, accounts for less than 3% of provincial business.

Limpopo has the country’s worst ratio of hospital beds to population, but the HIV infection rate, at 7.3%, is less than half that of KwaZulu-Natal.

With low crime and HIV rates, the life expectancy of 55.6 in Limpopo is second only to the Western Cape.

Nearly one in five of its people has had no education, schools are overcrowded and perform poorly, and hardly anyone with a university education lives in the province.

Limpopo scores on housing, with more than 80% of families in formal housing and the lowest number of shanties.

It is the least urbanised province — 85% of people still live in rural areas, which makes service delivery harder for a provincial administration with mini mal resources.

Limpopo ranked 5th in the Business Times analysis.

6. Kwazulu-Natal

With the country’s biggest, but third-least-productive provincial population, KwaZulu-Natal faces special challenges.

The nation’s highest HIV/Aids and TB burdens — in terms of absolute numbers infected and the rates of infection — mean that KwaZulu-Natal scores worst among the nine provinces on health. Adult and child mortality are the highest in the country.

The public health system has to take care of 8.6 million people who have no access to private hospitals. The province boasts the country’s highest bed-to-population ratio, but, with more than a third of public health positions vacant, using them well is impossible.

The education system has held up reasonably under the pressure of numbers, with matric and university entrance pass rates in the middle of the national range at 64% and 14% — and with one in four people already holding a matric certificate.

The province leads the nation in land restitution, which has cost R2.6-billion so far and, though facing one of the biggest backlogs, is building houses faster than any province other than Gauteng. The province trails with the Eastern Cape in the provision of water and electricity inside homes.

Though in the top three provinces for murder, aggravated robbery and car theft, crime is falling at above- average rates in all of those categories.

KwaZulu-Natal ranked 6th in the Business Times analysis.

7. Mpumalanga

Notwithstanding the magnificent scenery, poverty and a dismal education record make Mpumalanga one of the country’s least attractive provinces to live in.

Mining and manufacturing help the province to produce nearly 7% of national output and to keep two-thirds of the population employed, but the economy is growing more slowly than most provinces.

Moreover, the average household income is dismal in relation to most other provinces.

Mpumalanga has the second- least educated population and, at 61%, one of the lower matric pass rates.

Teachers also shoulder one of the heavier class loads — 33 pupils on average.

The adult mortality rate is the second highest in the country, child mortality is on the wrong side of the national average and average life expectancy has fallen to just 47.

The HIV infection rate is in the higher half of the national split at 13.5%, but infections and recorded Aids-related deaths are growing more slowly than in most other provinces.

A quarter of the population still awaits proper housing, while the provision of water, electricity and telephones is in the lower third among the nine provinces.

Mpumalanga has the second- lowest murder rate after Limpopo, but high levels and negative trends in most other safety and security measures give it a low overall ranking.

Mpumalanga ranked 7th in the Business Times analysis.

8. North West

North West has little to cheer about. It has a small economy, which is growing more slowly than most, high unemployment and a poor record on service delivery.

Mining boosts the region’s contribution to the national economy to 6.4%, but unemployment is above 40% and the average household income of R49697 is in the lower half among provinces.

North West has the country’s highest pupil-teacher ratio at 29 to one and the fourth-best matric pass rate of 67%. But, as with other poor provinces, most of those who gain a qualification leave for the more vibrant economies of Gauteng and the Western Cape.

The HIV infection rate is above the national average at 13%, almost the entire population of 3.4 million relies on the public health system and the province has the country’s lowest number of doctors and hospital beds per 1000 people.

With one in four families living in informal settlements, the province has the worst housing record in the country and has been the least successful at eradicating bucket toilets.

The delivery of electricity and water is below the national average.

The crime profile is on the good side of the national average, but North West is doing less well than most provinces in bringing the rates down. Armed robbery and house burglaries have climbed since 1994.

North West ranked the Business Times analysis.

9. Eastern Cape:

The Eastern Cape is no place to live, get sick or go to school.

Barely half the people live in formal houses, no other province has such a large proportion of the population without water, electricity or cellphone access and only North West has more homes still relying on bucket toilets.

But it’s not the worst place to work.

Thanks largely to the motor industry, the province contributes nearly 8% of national output and the unemployment rate, of 38%, is not the worst in the country.

The Eastern Cape is the second-biggest province with 14% of the country’s land and people, but it has the country’s fastest population growth rate of 1.13% a year between 2001 and 2006.

Fewer than one in five people have passed matric, 15% of the people cannot read or write and fewer than one in 10 pupils gets a university entrance matric.

The murder rate is the highest after the Western Cape, at 52.5 per 100000 people, and it is dropping more slowly than in most provinces, but business burglaries are the lowest in the country.

Healthcare is the province’s worst feature with the highest incidence of diarrhoea among children, high and rapidly growing levels of HIV and TB infection, average life expectancy of only 48 years and only one state doctor for every 6273 people.

The Eastern Cape ranked last overall on the Business Times analysis.

Western Cape set for Mideast investment

By Aziz Hartley


Rasool also said that Arab businessmen were keen to purchase local farms. Agriculture MEC Cobus Dowry said the businessmen were told about 14 farms that were for sale at an average price of R16 million.


aziz.hartley@inl.co.za

they can have my farm for 16 bars

Thanks Marco

R600bn infrastructure roll-out to provide growth impetus

By: Terence Creamer
Published: 9 May 08 - 0:00

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

South Africa could still attain its target of 6% growth from 2010, despite the “serious power emergency”, the Presidency’s deputy policy head, Alan Hirsch, said at the release of the 2007 annual report for the Accelerated and Shared Growth Initiative for South Africa (Asgisa) last week.
He added that the power crisis was not a “fundamental impediment” to the attainment of the programme’s stated growth aspirations.

Asgisa, which had been running for two years, sought average growth rates of 4% from 2006 to 2010, to be followed by an average of 6% from 2010 to 2014.

In an earlier address, Deputy President Phumzile Mlambo-Ngcuka argued that government’s unprecedented R600-billion public-investment programme, which would be deployed over the next five years, would continue to provide growth impetus.

“South Africa is now a construction site,” she quipped, in a speech delivered at a function held on the grounds of the Presidential Guesthouse, in Pretoria.

22 000 STATE PROJECTS UNDER WAY
Infrastructure was also the overarching theme of the annual report itself, dedicating 30 of its 70 pages to the topic.

Crucially, it showed that there was a growing capacity to deliver on infrastructure projects, even at municipal level.

Investment spending by national departments rose 30% in 2006/7 and by 13% for the first two quarters of 2007/8 and there were now some 22 000 investment projects being monitored under the so-called national infrastructure project register, covering everything from bridges and municipal roads to schools and hospitals.

But Mlambo-Ngcuka stressed that creative links had to be found to sustain work opportunities for those currently occupied in the infrastructure projects once they were completed, and called for greater cooperation between the public and private sectors to address the challenge.

Similarly, she called on the business community to support government by back-integrating their procurement strategies into South Africa’s so-called ‘second economy’, so as to help support the creation of small-scale enterprises.

“In the next year of Asgisa, we want to address both poverty and inequality,” she insisted, stressing that the growing gap between rich and poor was “politically and economically” unsustainable.

Hirsch said that, in spite of the expectation that the economy would slow down in 2008, there was no immediate reason for government to change its target of halving poverty and unemployment.

“There are a variety of estimates for growth in 2010, but virtually all of these from the private sector are over 5%. We are talking about growth averaging over 6% for 2010 to 2014, so there is no reason for us to back off from that at this stage . . . it would be the wrong thing to do, as there is no evidence [to suggest] that it is impossible.”

He added that even if the most pessimistic growth targets were accepted, South Africa would still meet its target for the period to 2010, “if we aver- age out the entire period since 2006”.

“Our expectation is that we will get our response correct and that we will remove the key obstacles to medium-term growth,” he added, noting that, while there would be some costs, “the fact that it happens at the same time as an international downturn probably is good fortune for us, as it allows for some time to catch up”.

From Marco

Shell opens Cape Town call centre
Shaun Benton

15 May 2008

Oil multinational Royal Dutch Shell has opened a global call centre in Cape Town, which will be used to service the company's customers in Belgium, Netherlands and Luxembourg, with centre operators conversing with their clients in Flemish and Dutch.

Deputy President Phumzile Mlambo-Ngcuka was present at the call centre establishment, which is in part a result of the government's efforts to boost business process outsourcing (BPO) - seen as on of the way in which the country can increase employment and economic growth.

The call centre will harness the Afrikaans language medium largely spoken in the Western Cape province, with Shell training speakers to converse in Flemish and Dutch over several weeks, allowing the Cape Town-based staffers to converse with customers in these countries in their own language.

By establishing the call centre in Cape Town, Mlambo-Ngcuka said that Shell demonstrated its confidence in South Africa's ability to offer a balance between high-quality and low costs in the BPO sector.

In addition, she said that state-owned Broadband Infraco would lay a new fibre optic cable along Africa's west coast from Cape Town to the UK, ensuring cheaper and more widely available bandwidth and cheaper international phone calls.

Favourable language, time zone
The language capacities - particularly with the international language medium of English - and the cosmopolitan nature of South Africa's cities placed the country in a good position to attract further investment in the sector, Mlambo-Ngcuka explained.

Other factors that placed South Africa favourably in comparison with other call centre destinations like India and the Philippines was the time zone, which was more or less the same as that of Europe, she added.

Shell pointed out that this time zone synergy allowed staffers to work day shifts, which would lead to cheaper costs, as employees did not have to be compensated for working night shifts in order to cope with time zone differentials.

Shared growth and job creation
The centre has so far created 145 jobs in the city, with 300 new jobs envisaged by the end of 2010, Shell said at the centre's official opening.

Shell global customer services vice president Sally Cranshaw said that critical mass and economies of scale allowed the company to make successful operations of its global call centres, the first of which was opened in the Philippine capital Manila two years ago.

Speaking on the benefits of call centres to South Africa, Mlambo-Ngcuka said that BPO was identified within the Accelerated and Shared Growth Initiative of South Africa (Asgi-SA) for its ability to bring people with only a basic education into the industry at entry level.

As such, the BPO industry allows semi-skilled people to enter the industry and with potential to learn more, with experience in such industries acting to boost the skills of these employees.

"When we initiated Asgi-SA it was about finding ways in which we could continuously intervene in the economy - in a healthy way - in order to make sure that we place emphasis in the growth sectors that also respond to creating jobs for average people with relatively lower education," she said.

Source: BuaNews

By Marco

IFC calls for private fixed investment
14 May 2008

The International Finance Corporation has called for more private investment in South Africa's infrastructure sector, adding that it was ready to engage with stakeholders to find solutions to the country's power shortage and increase private investment in health, education and other social infrastructure.

"[The] IFC seeks to expand its advisory services to governments and increase investments in the region's infrastructure," said IFC business advisory services vice president Rachel Kyte in a statement this week.

"We can add value by lending our expertise to governments in structuring private sector participation in infrastructure projects, and by helping private companies improve their energy efficiency."

Kyte, a leader within the IFC at demonstrating how high standards are good for business and help develop markets, drew attention to the value that companies could create through paying greater attention to environmental and social issues.

She emphasised that companies could manage risk better and find new business opportunities related to sustainability by adopting good environmental and social practices.

Kyte was recently in South Africa on her first visit to the region in her new capacity as vice president, to review IFC projects and engage stakeholders on ways to improve the climate for private sector investment.

She visited Lonmin, one of South Africa’s leading platinum miners, in which the IFC has invested US$150-million to support the miners expansion and $6-million more toward a joint initiative to increase supply opportunities for small and medium enterprises and in community development activities surrounding the company's mining area.

"[The] IFC has a significant presence in South Africa, through investments in Lonmin and other projects," she said. "We want to do more with partners to develop sustainable projects that empower local communities and serve previously underserved markets such as small and medium enterprises."

During the 2007 financial year, the IFC - a member of the World Bank Group - committed $1.4-billion to 52 projects across sub-Saharan Africa, $172-million of which went toward infrastructure projects.

SAinfo reporter

Multi-billion power station to be built

May 16 2008 at 12:34PM

Eskom has awarded a R2,9-billion contract to a consortium of SA companies for the construction of the main civil works at its Medupi Power Station in Limpopo, the utility said on Friday.

A consortium made up of Murray and Roberts; Grinaker-LTA Civil Engineering and Concor was awarded the contract.

"Medupi will be the biggest dry-cooled power station in the world with a capacity of 4 800 megawatts," said Brian Dames, Eskom's Chief Officer for Generation.

The first unit is scheduled for completion in 2012 and the entire station is scheduled to be completed by 2015.

Dames said Medupi was one of Eskom's key installations in the New Build programme geared towards closing the current supply-demand gab.







The contract covered the construction of roads, drains, foundations, column supports, floor slabs, basements and all civil engineering work, Dames said.

"Also included are the utility spine and connectors beneath an auxiliary bay, the boiler house and turbine hall," he said.

Work on the site is expected to commence soon. - Sapa

Coega smelter not on the back burner, says Alcan executive

Bob Kernohan BUSINESS EDITOR

PROSPECTS for the building of the R20-billion aluminium smelter at Coega brightened again yesterday, with a senior international executive of minerals giant Rio Tinto Alcan saying in Port Elizabeth that the project would be going ahead.

“Our company would not let us continue with planning of the Coega project if it was not going to go ahead,” said Canadian-based Rio Tinto Alcan business development vice- president Yvon d‘Anjou. “It is going to happen one day.”

But D‘Anjou, at Coega for the signing of a milestone memorandum of understanding on policies to mark the formation of an environmental alliance, said he did not know when that “one day” would be.

Rio Tinto international chief executive Tom Albanese indicated in London earlier in the week that the project could be completed by 2015.

Albanese was referring to a forecast that the company‘s production of aluminum would rise 7,6% a year through to 2015 as “projects such as the Coega smelter in South Africa come on line”, the Dow Jones financial service reported.

At yesterday‘s Coega signing, D‘Anjou said the delay in going ahead with the project could, in fact, provide benefits as Rio Tinto Alcan‘s aim was to improve technology and reduce the amount of power used in its smelters by 10% to 15%. “The processes of burning coal (for power) to make aluminium will be improved,” said the vice-president, who is based in Montreal, Quebec, and was at Coega specially for the signing ceremony.

The project was now in an “interim period” after having been delayed because of the Eskom power crisis and doubts over its ability to meet the smelter‘s high demands.

Earlier, the company‘s South Africa stakeholder relations and communications director Robert Valdmanis, said it was already working with a special task team to find ways of overcoming the power problems.

The company was also “committed to staying active in the local community” as an indication that it was still “planning ahead” for the establishment of the smelter.

“We have come to the end of a stage of the project and are now in an interim phase, during which lots of constructive things will continue to be done, although there will be no physical construction.”

Valdmanis said it was “too early at the present time” to speak of revised timing.

He was asked for Rio Tinto Alcan‘s reaction to the discussions of a proposal to build an independent power station to serve Coega and Nelson Mandela Bay at a cost of between R5-billion and R6-billion and said the firm was “always encouraged” by such initiatives.

R7,5bn to develop Mpumalanga mines

2008/05/17

BHP Billiton Energy Coal South Africa has invested R7,5bn to help Mpumalanga fight unemployment and poverty by developing and revamping new mines in the area.

Economic Development and Planning MEC Craig Padayachee said this investment would surely put the province on the road to deliver a better life for the people of Nkangala and the province as a whole.

Coal mining dominates the mining industry in this province. Most of the collieries in the province are concentrated around the towns of Witbank, Middleburg, Ermelo and Secunda.

According to the Council for GeoScience, Mpumalanga has 291 coal mines which contributed 82,4% of the national GVA-R in 2006. – Bathandwa Mbola, BuaNews

Eskom monopoly could end
May 19 2008 12:24PM

Johannesburg - The National Energy Regulator of SA (Nersa) has recommended new private power generation capacity and independent power producers to be managed independently of Eskom as a means of solving the country's power crisis.
Nersa, in a report released on Monday, also suggested co-generation partnerships.

It suggested that the government's National Electricity Emergency Programme, including the Power Conservation Programme, be coordinated and led by a centralised high-level government unit with authority to take action.

According to Eskom, the high unplanned maintenance and load losses, combined with the usual high planned maintenance of generating units, poor coal quality, wet coal and low stockpile levels were to blame for South Africa's recent outages.

The report found that inadequate primary energy procurement and power station production planning affected coal stockpiles, which were allowed to decline to unacceptably low levels.

This was compounded by a reluctance to obtain supplementary coal due to its high cost and its impact on Eskom's financial position.

Nersa said although Eskom had anticipated the current growth rate, the implementation of measures to provide for this growth were inadequate and slow.

There were delays in bringing mothballed power plants back online, and the implementation of energy efficiency and demand management was lagging targets.

Eskom's building programme is experiencing delays of at least a year.

The regulator said the government should consider formulating a policy that would balance Eskom's commercial decisions and the national security of electricity supply in order to avoid national crises.

Further investigation into the management of primary energy, coal management and the availability, adequacy and optimum utilisation of Eskom's generation plant in emergencies, especially in view of the mid-life of these plants, was also recommended.

SA looks superficially like a prime candidate for complete deregulation and the setup of regionalised power trading.

This will allow better capitalisation and much faster response to changing demands, but will result in overall higher prices, different regional prices (e.g. CTN will be highest), seasonal pricing and generally more pricing volatility.

However I am not sure the population are mature enough to accept this.

Twenty percent of South Africans are planning to emigrate or are seriously considering it, according to the results of a survey released on Wednesday by global market research company Synovate.

Spokesperson Jake Orpen said 600 respondents were interviewed in all nine provinces of South Africa, using face-to-face interviews.

The results were weighted to ensure representation across province, age, gender and race.

"South Africans are not in the best frame of mind lately, due to the obvious political uncertainty, economic instability and electricity problems," Orpen said.

The option to emigrate was most popular amongst young and middle-aged South Africans (18 to 44 years).

Loss of skills

This was of concern because this age group represented South Africa's current and future skills set.

Rand Merchant Bank Senior Economist, Ettienne le Roux, said: "The obvious negative for any country experiencing high levels of emigration is the loss of skills and the future income these skills would have generated.

"If emigration is not matched by immigration of people of at least the same skill, the country will no doubt be worse off.

"In this regard, it is encouraging that the South African government is showing preliminary signs of making it easier for skilled foreigners to come and work in our country."

Some 27 percent of respondents believed that they would be able to successfully emigrate, would have the required funds and that they were well-qualified.

On the other hand, 51 percent of respondents said they would not be able to afford emigration and the remainder were unsure.

According to a recent FNB survey, emigration has been cited as the biggest single reason for selling upper-end properties.

US most popular destination

The USA emerged as the most popular choice of destination, followed by the UK, Australia and New Zealand.

The main pull factor for immigrating to a country was business and employment opportunities in other countries, 88 percent of respondents stated.

Itchy feet, the desire to explore a new country and experience different cultures, were cited by more than a third of those considering emigration, the survey reported.

The main push factor for emigrating from South Africa was violence, crime and corruption, 55 percent of respondents said.

Other push factors were South Africa's volatile economy and the cost of living (19 percent), governmental problems (13 percent) and infrastructure concerns (6 percent).

Family reasons (14 percent), such as joining extended families abroad and better education for children, were also mentioned.

South Africans (4 percent) admitted to having encouraged their children (of university-going age) to leave South Africa and a further 3 percent said they would encourage their children when the children were old enough.

Encouraged by others

Some 85 percent of respondents said that they had not been encouraged by anyone to leave South Africa. Fifteen percent said they had been encouraged by others to emigrate, of which 8 percent said that when considering emigration, friends were the main influences.

A third of the respondents surveyed said they knew someone who had emigrated from South Africa in the past five years.

Those who had emigrated were perceived to have left for work or crime related reasons.

However, 47 percent of respondents had no intention of leaving South Africa and a further 17 percent had not thought about it.

When quizzed on the things they loved about South Africa, 46 percent said the climate and nature were the main attractions.

Eighteen percent of respondents loved the South African people. Fifteen percent pointed to the freedom South Africans had been granted and 14 percent pointed to the diverse cultures that existed in South Africa.

Just over a tenth loved South Africa because it was home to family and friends

S African growth at six-year low (http://news.bbc.co.uk/2/hi/business/7422300.stm)

The mining sector saw production fall sharply
South Africa saw its economic growth slow sharply in the first three months of this year, marking a six-year low, according to official figures.

The economy grew 2.1% in the first quarter on an annual basis, from 5.3% in the final quarter of 2007.

The worse-than-forecast slowdown is blamed largely on power cuts affecting the mining industry.

The mining industry saw its output drop 22.1% in the first three months of 2008 to its lowest level in four decades.

"There is definitely a slowdown in the economy," said Joe de Beer, executive manager of national accounts at Stats SA.

"The two industries that constrained growth were mining and quarrying and manufacturing," he said.

While manufacturing grew by 8.2% in the last quarter of 2007, in the first quarter of this year it slipped by 1%.

Analysts said the latest wave of anti-immigrant violence had no clear impact on the economy to date, but their effects may yet be felt.

"Those attacks have made the tourism industry nervous," said the BBC's Caroline Hawley in Johannesburg.

"Large mining companies are also concerned because they rely on migrant labour," she added.

SA to launch battery-operated car in 2009

By: Sapa
Published: 30 May 08 - 14:26


South African-designed, battery-operated passenger car is to be unveiled early next year, Deputy Science and Technology Minister Derek Hanekom announced on Friday.
The development of the vehicle - described as "beautiful" by those who have had a glimpse of the design sketches - could not have come at a better time, he told MPs during debate in Parliament on the science and technology budget vote.

"The project... involves a range of stakeholders, including South African universities and industry. The first prototype of this vehicle will be launched by the end of this year, or early next year.

"Given our economy's vulnerability to volatile oil prices, and growing concerns about the pollution resulting from fossil-fuel transport, the timing of this development could not have been better," Hanekom said.

Dr Boni Mehlomakulu, group executive of the department's research, development and innovation programme, told Sapa that both a passenger and a utility vehicle were currently being developed.

The passenger vehicle, "designed by a former Jaguar designer", was a six-seater. It had a range of between 100 km and 400 km, depending on the speed at which it was driven, and the roof incorporated solar panels to help charge the battery when it was parked in the sun.

The utility vehicle, which Mehlomakulu described as "like a panel van", was a three-seater.

Both vehicles could be plugged into the mains at night - when demand for electricity was low - to charge their batteries, which were imported from China.

Mehlomakulu was reluctant to divulge further details of the vehicle designs, saying development was still under way. She also declined to release photographs or sketches, saying this would be done closer to the launch.
Funding for the project came from the department's Innovation Fund, "which funds projects that have potential for commercialisation".

Asked how many units were planned, she said initial production, in 2010, would be about 4 000 units a year. An amount of R300-million was needed to build a factory to produce the vehicles.

Initially, the vehicles would be produced for the government fleet, an arrangement that had provided backers of the project with an entry point to the local car market.

Further sales would obviously depend on demand, and whether investors could be found.

On what the vehicles would cost, Mehlomakulu said there was "no pricing model at this stage".

Sounds like complete bollocks from the ivory tower.

R10bn earmarked for improvements at SA's major ports

By: Christy van der Merwe
Published: 5 Jun 08 - 14:21

South Africa would spend R10,3-billion over the next five years to improve its equipment and infrastructure at its major ports, Transnet Port Terminals (TPT) CEO Tau Morwe said on Thursday.
Speaking at the Africa Ports and Harbours congress, in Sandton, he stated that the utility had invested close to R2-billion in the 2007 financial year on port terminals, and that it had budgeted over R3-billion to deal with infrastructure backlogs.

This was a significant increase from the R400-million that it had invested in ports infrastructure in 2000/1.

For African ports to "stay ahead of the game" and ensure that they do not incur congestion surcharges, adequate capacity should be created ahead of demand. "Hence at the Transnet level, the emphasis being on investment on infrastructure, both on the rail side, and on the port side," Morwe said.

"Within South Africa, the focus is on ensuring that from a corridor perspective, both rail and port, there is adequate integration, adequate investments to ensure we meet the growth."

Morwe added that at the Durban Port, Transnet had seen a number of shipping lines moving containers from road to rail, however, in order for that to be done, the utility would need to ensure that the supply chain remained reliable.

Transnet was conducting an ongoing study to assess where to locate new container capacity to cope with the increasing demand. Durban Port was experiencing container growth levels of about 10% to 12%.

"If you look at where we were in 2000/1, and where we are right now, I can safely say that we are beginning to meet that demand and the key is ensuring that adequate capacity is created ahead of demand," affirmed Morwe.

He added that in 2008, South Africa's terminal utilisation was at around 78%, which meant that as the growth in containers took off there would be pressure on ensuring that demand was met.

Port congestion was mainly caused by "lacking superstructure", such as the number of cranes, so, while there could be congestion on the water side, "what we are now beginning to see in Durban is congestion on the land side rather than on the water side, trucks queuing all over the roads in Durban," Morwe said.

The lack in rail-capacity or rail-infrastructure, also contributed to congestion, and depending on how integrated the supply chain was, that could also result in congestion, and in some cases low productivity levels at ports.

I want to see the Cape Town doubling in size!

SA dumped over power woes
Jun 11 2008 9:00PM

London - Structural energy problems in South Africa is forcing investors to turn away from the mineral rich country and focus on prosperous Brazil, the Reuters Investment Outlook Summit heard on Wednesday.
Mining companies and other major electricity consumers have had supplies rationed since the national grid came close to collapse in January and with few solutions in sight investors will start looking to other areas.

"This has cost South Africa this year - it has been a big disappointment to investors," said Chris Palmer, head of global emerging markets at investment fund Gartmore.

"Brazil has been a good place to invest, South Africa has been less good."

South Africa has suffered electricity shortages since the start of the year as power utility Eskom struggles to generate enough power to meet demand.

The power shortages have dented economic growth, which fell to a 6-1/2-year low of 2.1% quarter-on-quarter in the first three months of 2008.

"South Africa has had many years to think about these issues so there is only one place where you can lay the blame - there has been chronic under investments by the government in the electric utility sector," Palmer said.

During a period of rising commodity prices a country like mineral-rich South Africa should be doing relatively well, he said.

"To have a constraint placed on growth because they cannot produce enough electricity - although they export coal to the rest of the world ... it is ironic," he said.

Most mines are operating at only 95% of normal power requirements.

Brazil and South Africa had a similar type of economic position ten years ago, Palmer said, adding when Brazil faced power difficulties in 2002 the government took action to make sure its industry remained attractive.

"That work hasn't been done to the same extent in South Africa ... these are two countries exporting similar items but their industries are asymmetrical, affected by public planning and public policy," Palmer said.

Brazil is more than 7 times the size of South Africa, it is blessed with abundant water and most of its power is hydroelectric. South Africa's energy is dirtier, since it relies mostly on the burning of coal. You can't compare both countries. I think the solution would be for South Africa to conquer all its northern neighbours including Congo, and develop the countries Brazilwise....

Brazil is more than 7 times the size of South Africa, it is blessed with abundant water and most of its power is hydroelectric. South Africa's energy is dirtier, since it relies mostly on the burning of coal. You can't compare both countries. I think the solution would be for South Africa to conquer all its northern neighbours including Congo, and develop the countries Brazilwise....

That is exactly my view, we should be on the forefront of helping countries like Mozambique, Zimbabwe (sadly now a scumbag), DRC, Zambia develop. Just DRC is enough to keep us really busy.

Volkswagen SA wins R12bn component export contract

By: Irma Venter
Published: 17 Jun 08 - 15:57

Volkswagen of South Africa (VWSA) has won a R12-billion contract to supply its German parent, the Volkswagen group, with diesel particulate filters (DPFs) for the next five years.
VWSA will complete the contract in partnership with local catalytic converter and exhaust systems manufacturer, Eberspächer South Africa, which will share the production volume.

A DPF is designed to remove diesel particulate matter or soot from the exhaust gas of a diesel engine, and is rapidly gaining popularity as global emission standards are becoming more strict.

The component forms part of the latest common rail engines that are manufactured by the Volkswagen group.

VWSA MD David Powels said the deal was one of the biggest export contracts for a single part ever awarded to the South African company.

"Furthermore, it is a coup for the South African automotive component manufacturing industry."

Collectively, VWSA and Eberspächer SA will invest about R55-million in tooling and equipment to manufacture the DPFs.

In addition, the investment in the broader national supplier base will reach about R26-million. Eighty per cent of these suppliers are based in the Nelson Mandela Bay region, in the Eastern Cape.

VWSA estimates that the new contract will secure more than a hundred new jobs in the region.

VWSA and Eberspächer SA will use the most modern DPF manufacturing method known as calibrated stuffing, which encompasses new laser measuring and sizing technologies.

"This is the benchmark in the Volkswagen group and will benefit the South African catalytic converter industry as a whole," said Powels.

DPF production will start in November.

From VWSA the parts will be shipped to the Volkswagen group's Kassel plant, in Germany, where they will be completed and sent to various user plants in the automotive manufacturer's global network.

"The decision to award the contract to VWSA proves emphatically that South Africa can be globally competitive in terms of pricing and technology, even when measured against the best global players in the DPF industry," said VWSA purchasing division head Karlheinz Hell.

Eberspächer SA MD Henry Eksteen said the project was unique in its approach of cooperation and the utilisation of manufacturing capabilities of two companies.

"This type of parallel project, we believe, will become the benchmark for the future, where an OEM (vehicle manufacturer) can join forces with a specific technology partner to optimise processes and, thereby, gain access to global business for their region and country."

Catalytic converters are South Africa's biggest single automotive component export.

Export sales of catalytic converters reached R18,3-billion last year, compared to R15,8-billion in 2006.

South Africa has a 14% market share in the global catalytic converter manufacturing industry.

Transnet mulls new container options at both Durban and Richards Bay

By: Terence Creamer
Published: 13 Jun 08 - 10:46
Perhaps partly because of the debilitating supply-to-demand misalignment in South Africa's electricity sector, Transnet CEO Maria Ramos, who oversees South Africa's second-largest State-owned enterprise after Eskom, is going to some length these days to stress the increasingly sophisticated nature of planning at the freight-logistics group

Speaking at the Gordon Institute of Business Science, in Johannesburg, recently Ramos revealed that the group, together with the University of Stellenbosch, has developed a freight-demand model, which has materially increased visibility of cargo movements in the country, as well as those variables influencing growth in the sector.

This, in turn, is helping to shape the group's response plans and the corporation's R80-billion, five-year capital expansion of its harbours, railways and pipelines. But Ramos hinted that these investment programmes might even need to be upscaled in light of indicators showing that freight demand could double, or even triple, over the next 20 years.

Best estimates show that freight demand is likely to expand by an average of 4,7% a year over the next 20 years and that the challenge, from Transnet's perspective, is the foster an integrated solution between road and rail, which enables rail to recapture market share.

There is a particular focus emerging in the general freight areas, which yields 75% of Transnet Freight Rail's revenues, but where margins are paper-thin and the reliability of the locomotive and wagons is hampered by the advanced age of the fleet. Indeed rail's share of the significant corridor linking Durban to Johannesburg is estimated at only 21%, which is Ramos' view is, thus, also its biggest opportunity.

The company will, therefore, spend R38-billion between 2008 and 20013 to modernise and expand its rail business, with the five-year investment planned for the Gauteng-Kwazulu Natal corridor, making up R25,3-billion of that. Some 212 new diesel locomotives will be purchase for R56,14-billion, while tests are under way on the first of what could be 50 ‘like new' locomotives to be delivered out of Transnet Rail Engineering's Koedoespoort facility.

"We now have a freight demand model for 95 commodities and how it [the freight] moves across the main corridors," she enthuses.

"We have also stress-tested the model, by plugging in different growth variables to understand what it means for capacity at say, the Durban Container Terminal, or on the rail network. And, if we are facing increases of say, 15% rather than 8%, when would we need to make the capital expansion decision and where should that expansion take place."

She reports that a study has been completed on the expansion of the container terminal at Bayhead in Durban, while another feasibility study is under way for the possible creation of container-terminal capacity at Richards Bay.

The Bayhead feasibility study considered the option of building a new terminal with capacity for six-million containers a year, while a phased expansion at Richards Bay could add capacity for 5,6-million containers a year.

"We will have to make a decision between Richards Bay as opposed to Bayhead in the next eight to 12 months. Because we realise that, if we are going to be growing container volumes in that Durban/Richards bay area by 12% to 15% we have a good idea when it is we will need to have installed capacity.

She says there is also vastly improve visibility of what capacity need to exist in order to feed the port and how much should come in by rail as opposed to road.

SA economy on eggshells
Jun 20 2008 7:04AM

Johannesburg - South Africa's current account deficit widened to a 26-year high of 9.0% of GDP in the first quarter of 2008 while the portfolio inflows key to funding it turned negative, central bank data showed on Thursday.
Moody's sounded a note of caution and analysts said South Africa's economy and currency were vulnerable to the large current account gap, the financing of which was now uncertain.

South Africa's Reserve Bank said in its June quarterly bulletin the current account gap, which was up from 7.5 percent of gross domestic product in the fourth quarter of 2007, was at its highest since the first quarter of 1982.

The financial account remained in surplus, albeit smaller at R47.8bn, but portfolio investment recorded an outflow of R19.1bn, the largest since the second quarter of 2001.

Lehman Brothers analyst Peter Attard Montalto said the gap would likely widen even further this year given the services account deficit of a record R133.2bn.

"The key concern is the funding of this (current account) deficit, however. In the past the run rate of portfolio flows was around R20-30bn per quarter," he said.

"The current account funding looks precarious for Q2 and beyond."

Analysts said the widening deficit left the rand, which has lost around 15% to the dollar this year, more vulnerable, adding to political and economic policy uncertainty.

Investors are watching whether the market-friendly policies of president Thabo Mbeki will outlive him in government.

A power shortage that hurt the key mining sector has raised concern about economic growth while news images of South Africans attacking immigrants have highlighted the potential for political instability.

Moody's ratings agency said South Africa's positive ratings outlook was under strain due to deteriorating economic conditions and social conditions and hinged on whether policies will change after Mbeki's administration ends in 2009.

Future uncertain

New ruling African National Congress (ANC) leader Jacob Zuma is the frontrunner to succeed Mbeki, and his backers - trade unions and the ruling party's communist allies - want more left-leaning policies.

"The events of the past year do appear incongruous with the positive outlook," Kristin Lindow, Moody's Senior Vice President and South Africa sovereign analyst, said at a conference.

"I would like to get a bit of a sense of whether or not there will be significant changes (to economic policy)," she told Reuters in an interview. "Those are the kinds of things that really affect our decision."

The quarterly bulletin also showed household spending under pressure, in part due to higher interest rates.

South Africa's targeted CPIX inflation hit a 5-1/2 year high of 10.4% year-on-year in April, prompting the central bank to hike its key repo rate by another 50 basis points to 12% last week, bringing total increases to 500 basis points since June 2006.

Annualised household expenditure growth moderated to 3.3% in the first quarter from 3.8% previously and 7.0% for 2007 as a whole.

The central bank said private sector fixed investment growth remained strong but South Africa's dependency on foreign capital reached a new record high of 39.5% in the period.

"Overall, the bulletin points to an economy and a currency vulnerable to poor current account funding and stress in the household sector, but helped by strong investment," said Lehman Brothers' Attard Montalto.

Expats invest in property for 2010
2008/06/20

South Africans overseas are investing their Pounds and Canadian Dollars on guesthouses back home in anticipation of a 2010 boost in the hospitality industry.

Executive director of Pam Golding, Richard Day, said they have "recognised there is a shortage of accommodation (and that) it is a viable investment".

He added that South Africans working overseas form part of a "niche market of South Africans that will gain on a commercial opportunity".

According to information recently released by Pam Golding, Pam Golding Lodges & Guesthouses (PGLAG) have concluded transactions to the total value of over R130m over the past 12 months, and "some 70%" of the guest lodges went "to overseas buyers or South Africans returning to the country".

Peter Bruil of PGLAG said international buyers have adopted a longer planning horizon in regard to capitalising on this forthcoming high-profile event.

"In light of the fact that we know we will have a room shortage for 2010, this is a profitable economic venture which South Africans earning stronger currencies are capitalising on," Day said.

The former manager of Cape Town Tourism, Sheryl Ozinsky, however warned that the Soccer World Cup was likely to leave a vacuum in its wake if developers and buyers over-capitalise on the hospitality industry.

Huge events like the world cup tended to displace more visitors than they attracted, she said. "It's not going to make money for lots of people…I think it's important that people see this event in its context."

Gerlinde Moser, broker owner for City Bowl and Sea Point RE/MAX, said South Africans are definitely coming back.

"Of course South Africans are coming back…from Dubai and countries like Canada and Australia to buy property in light of 2010, but they are coming back for many reasons, not just money."

Often, they "have to come back" when their work contracts expire and they are unable to renew their permits or get residency, or in order to be closer to family. "It's a necessity in a way for them to come back and invest here."

Other South Africans are bringing their Pounds back because they feel their "duty is to (their) country", or because "the grass wasn't greener", she added. – Anita Funke, West Cape News

today Nedbank projected Rand-$ at 14:1 by mid 2009 up from 8.20:1 today. Its great for me and other saffers comming home or investing in Property and great for Sa exporters but a bitch for gas and other imported products

Oger Telecom sets its sights on Telkom
24 June 2008

Dubai-based Oger Telecom wants to negotiate its new offer for South Africa's largest telecom operator Telkom with Telkom's potential buyers.

A consortium led by Mvelaphanda Group's holding company Mvelaphanda Holdings said earlier this month it was considering making an offer for Telkom, provided Telkom sold its 50 percent stake in mobile phone group Vodacom.

Vodafone, which owns the other 50 percent of Vodacom, has offered to buy a further 12,5 percent of Vodacom for R18,75-billion.


Oger Telecom, which owns South Africa's mobile operator Cell C, wants to merge Cell C with Telkom's fixed line business on condition that Telkom's mobile unit be sold off. South African government rejected Oger's first offer in April.

"We want to create a model in South Africa that is similar to that we have in Turkey between Turk Telekom and Avea," Paul Oger Telecom CEO Paul Doany told Reuters.

Oger has a controlling 55-percent stake in Turk Telekom and 81-percent in Avea, Turkey's third-largest mobile operator.

"We believe fixed/mobile convergence to be ideally suited to the market in South Africa and that there is much to be gained by all stakeholders in that regard," said Doany, also chief executive of the Istanbul-based Turk Telekom.

Oger, controlled by the family of late Lebanese prime minister Rafik al-Hariri, also operates in Saudi Arabia, Lebanon, Turkey and Jordan, providing fixed-line, mobile and Internet services.

Renault-Nissan alliance invests R1bn in SA

By: Irma Venter
Published: 18 Jul 08 - 14:53

The Renault-Nissan alliance is investing R1-billion in the local manufacture of the Renault Sandero as well as the Nissan NP200 small pick-up.

The NP200 is the successor to the well-known 1400 bakkie, which had to be replaced as it did not meet emission standards applicable in South Africa as from January this year.

The two cars are developed on the same platform, namely the B0, or Logan platform.

The new Nissan half-ton pickup and the Renault Sandero are to be produced at Nissan’s Rosslyn plant, just outside Pretoria.

The plant first opened its doors in 1963, and produced its millionth car in 1992.

The plant currently assembles the Hardbody, Tiida Hatchback, Tiida Sedan, Grand Livina, Livina and Livina X-Gear, and now also the NP200.

The plant produced some 44 000 vehicles in 2007.

Production of the Renault Sandero will start in 2009. There is no official production forecast available for this model.
Some 300 jobs will be created in the plant in 2008.

Components nor produced locally for the two models, will come from Romania, India (right-hand drive components), Brazil (stamping parts), and Turkey and Spain (powertrains).

It is not anticipated that the project will lead to increased production capacity at the plant, currently at 54 000 units a year on a single eight-hour shift, or 140 000 units making use of three seven-hour shifts.

Renault South Africa MD Xavier Gobille says the Sandero “will represent affordable motoring, produced to meet the needs of the South African market, and will be the first Renault product manufactured in South Africa”.

In the coming years, Renault will expand its product line-up offered to South African customers with vehicles ranging from entry-level to the more exclusive range, he adds.

Among them will be New Twingo and Koleos, Renault’s first crossover model, to be introduced into South Africa later this year.

Nissan South Africa MD Mike Whitfield says his company are targeting sales of more than 17 000 units a year for the NP200.

The company sold 6 800 Nissan 1400 bakkies in the 2007 financial year, down from just over 10 000 in 2006.

It is not yet known what the price of the NP200 will be, due to be launched locally in October.

The Renault-Nissan alliance says it is looking at the possible local assembly of more vehicles from the same platform.

Export of the Sandero and NP200 is also possible, especially into Africa, adds Whitfield.

The alliance, created in 1999, sold 6,1-million vehicles globally in 2007.

cqvQb-KQMtQ

The OECD reports about South Africa's economy.

For more info: http://www.oecd.org/country/0,3377,en_33873108_39418625_1_1_1_1_1,00.html

Does this mean that we will finally have one in Jozi CBD?

Virgin Active to spend R1,2bn on expansion in SA

COMPETITION in SA’s health club industry is intensifying after Virgin Active announced yesterday it was spending R1,2bn to refurbish gyms and open up to 40 new clubs in the next five years.


The company, which was launched in SA in 2001 and has 84 clubs, said the expansion would increase its membership of about 500000 by 50% within three years.


Health club rival Planet Fitness recently unveiled plans to open a R100m gym in Sandton targeting the high-end market. It also planned to spend as much as R500m on a countrywide expansion over five years, conclude a black economic empowerment deal and was mulling a listing on either the JSE or AltX within two years.


Both Virgin and Planet Fitness are expanding to tap the growing market for health clubs as more people adopt a healthier lifestyle, motivated by growing concern about obesity and unhealthy eating and drinking habits.


Virgin MD Mark Field said R750m of the total expansion budget had been set aside for a complete overhaul of existing clubs in the next three years, including the supply of ultramodern equipment, and the balance would be spent on building 40 new clubs.

Three new clubs had been opened and another three should be open before year-end.

Last year, Virgin opened four clubs, refurbished one, and up to 15 received what the company called a “refresher", involving mostly installing new carpeting, repainting and minor upgrades of equipment, Field said.


“Coming off a solid five years in the market in SA, Virgin Active will continue to entrench its position as the leader of holistic health and fitness facilities with the roll-out of its (expansion) strategy. This will underpin the company’s market segmentation approach, which seeks to increase the membership base by 50% in the next three years," Field said.


Field attributed the strong growth in the domestic health club industry to the growing global trend of more people seeking solutions to the “negative health effects of modern lifestyles".



“SA has seen significant economic growth in the past few years and we are seeing increased demand for health clubs across a broader section of the population. This translates into a need for new health club facilities as well as a segmentation of our product, in order to better serve the market," he said.


Under the segmentation strategy, Virgin would offer a three-tiered package for members, with classic clubs forming the top end of the market with new life centres, while fitness clubs would make up the bulk of the clubs.


Life centres would encompass “everything from mind and body studios to aqua lounges, fitness zones specifically focused at female members, and the Club V-max, Virgin’s junior care resource centre," he said.


Virgin is also identifying clubs in previously disadvantaged areas to assist with their equipment needs and has identified 12 such clubs.

SA too rude, expensive

Jul 24 2008

SA IS in danger of falling off the multi-billion dollar global contact centre map because of agents with "attitude", slow broadband and high telecom costs.
Three years ago management consulting firm McKinsey said SA's contact centre industry could create 150 000 jobs serving the booming offshore market: "if".

The "if's" included SA improving labour competitiveness, lower telephony charges and faster connectivity. The department of trade and industry made "business process outsourcing and off-shoring" one of the top three priority sectors to stimulate growth within government's Accelerated Shared Growth Initiative.

Yet requests for information to various department of trade and industry officials including dr Raymond Ngcobo, chief director, enterprise and industry development and Reshni Singh, deputy director: BPO&O incentives, went unanswered. This typified the too-little, too-late response of government to what could have been a key job creator.

Government incentives were introduced in March but are shrouded in confusion. Major operator, Sharon Haigh of AvantiCall, said they had yet to acquire new business because of the incentives and their experience is not unique.

Too little has happened to power the industry into a job creator and source of foreign direct investment.

Enthusiasm is not lacking from Mfanu Mfayela, CEO of an organisation called Business Processing enabling SA (BPeSA), the national body. He says SA has higher labour costs and telecommunications ("four to six times higher") than its primary competitors - India and the Philippines. But SA's "first call resolution" is better, as well as the capacity for agents "to handle unscripted calls".

Traci Freeman, consultant for operations, projects and local investment for ContactInGauteng said there were around 85 000 employees in the contact centre industry two years ago, but, "current figures for the private sector are between 150 000 to 175 000 with an estimated 150 000 in the public sector."

She says the industry hopes to have 100 000 offshore jobs by 2009: "25 000 direct and 75 000 indirect". Freeman estimates that 10% to 15% of the industry in SA is contracted to foreign companies, Mfayela puts the number at 20%.

How the industry will meet the target Freeman envisions is anyone's guess and seems to be another example of the industry hoping PR will blind fact.

Foreign interest waning

Sadly, foreigners are less interested in SA contact centres than three years ago. High phone billing is a factor but perhaps an even bigger disincentive are agents with attitude. South Africans are far more likely to be rude to customers. While Indian agents see the job as a career step, a failure by many SA companies to career path agents removes commitment.

A frustrated call centre manager of a major operation said: "For most agents, this is their first job, but there is a remarkable sense of entitlement. It is difficult to get agents to go the extra mile and not argue with clients."

Mfayela said: "In the past there was a mentality that saw a call centre as a cost centre that would handle bad calls, but now most heads of call centres are on boards or directors." His assertion is not backed by close scrutiny.

Staff in call centres are recruited differently to other staff within a business and few rise within those businesses despite the considerable operational knowledge they learn within those call centres. Agents tend to do the job for six months before burning out and few last beyond two years.

Service industries powered Ireland to being the second wealthiest country in the world and they are a significant driver in the Indian economy.

Until SA business and employees recognize contact centres as hubs for business intelligence gathering and the promotion of service excellence, we will continue to fail on a wide variety of fronts.

^^ I agree with the article, our South African call centre agents are so rude. My vrou works in the industry and she also complains about attitude of the young school leavers who do not care about the business and their jobs. I think companies should take drastic steps and fire the bustards who are not prepared to do what they were hired for.

I hope Neotel will accelerate its implementation and charge those comapnies reasonable costs. We are in desperate need of job creation in this country.

Lafarge finances R40m power project for new Gauteng grinding plant

Published: 24 Jul 08 - 17:20

Building materials producer Lafarge would finance a new R40-million 20-MVA, 132-kV bulk power supply at the proposed Middelvlei substation, which would supply electricity to its new one-million ton a year cement grinding plant, in Randfontein, in Gauteng, the firm announced on Thursday.

The construction of the new plant, which formed part of its R1,2-billion Project Rainbow cement capacity expansion project, was on schedule for commissioning at the end of this year, despite international freight rate increases and power disruptions bringing the activities to a halt at times.

"This is an ambitious project even on global standards and we were confident in CBMI's ability to deliver successful on-time commissioning of the plant," commented Lafarge project director Stanley Ko. The South African branch of China-based CBMI Construction was undertaking the turnkey construction project.

The Randfontein plant would subsequently be ready to receive the first clinker from the producer's new clinker production line at the existing Lichtenburg Cement Works, which would come on stream in January next year. As part of Project Rainbow, Lafarge was installing a 2 000 t/d kiln at the cement works.

A new rail line would transport the clinker from the Lichtenburg plant to Randfontein, where the final cement product would be manufactured.

Meanwhile, Lafarge CEO Albert Corcos said in the statement that the Randfontein project was bringing "considerable" socio-economic benefits to the surrounding communities.

"Because this is a greenfield project, in other words brand new, we have made a substantial investment in the infrastructure of the area, which will also benefit the community," he explained.

He added that in addition to the power supply, the producer had also invested in excess of R6-million in upgrading the traffic intersection outside the plant, as well as funded the expansion of the road outside the plant to accommodate the expected increase in traffic.

About 300 jobs had been created during the construction phase, while 50 new jobs had been created at the grinding station.

My vrou works in the industry ...

Pule, do you call your wife "vrou"? That's what my father calls my mother. And my uncle's wife calls him "man". It's so funny :lol:

Good article that puts SA doom and gloom in perspective

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

How many international airlines fly into Harare?

It is my contention that in the over 40 years that I have been associated with the JSE, South Africans have always over-reacted emotionally towards the exchange. When there is a bull market people believe it is never going to stop and when there is a bear market everyone believes that the sun will never shine again.

South Africa appears to be at the height of a gloom cycle at present but let me try and put matters in perspective.

I have now experienced five bull and five bear markets on the JSE. Whenever markets correct it is usually due to sharp downward or upward spirals in a particular sector. In the late 1990's the downturn was caused by the dotcom crash and in 2008 the sub-prime mortgage crisis in the US has caused upheaval in the banking and financial services domain.

Twenty years ago due to strict exchange controls, we were, to a certain extent, able to resist market trends in the rest of the world. However today, whatever the movements of the major or emerging markets, they are going to affect us.

Despite periods of uncertainty we must never underestimate the strength and resilience of the South African economy. As a one-man market research team it never ceases to amaze me every time I fly overseas to see how many international airlines now service this country.

I believe that this is a reliable barometer of a country's viability and acceptability within the international community. How many international airlines fly into Harare?

Leading up to the World Cup, Durban's new international airport at La Mercy, with it's adjoining trade and agricultural export zones, will be in use by 2010.

Together with Cape Town we will then have three top-class international air gateways into South Africa that will be of great benefit to the tourism and hospitality industries which are probably our greatest generators of new employment.

My other personal reflections on the state of our economy are strengthened by the number of building cranes I see in Sandton every day when I drive into work and when I visit Cape Town or Durban, the large number of ships waiting to enter these ports.

South Africa is a complex country and, although not necessarily firing on all cylinders at present, I do believe we have in place one of the most progressive constitutions in the world and, due to our free press, an environment conducive to political debate.

We have a robust legal system and increasingly good corporate governance within the companies listed on the JSE and Altx.

We have first-world financial and banking services and the Mzanzi account, which is aimed at giving a large number of underprivileged people banking accounts, is a great example of South African innovation.

However, what enables me to sleep more easily at night is South Africa's staggering mineral wealth. For more than a century South Africa's economy has been built on the country's vast resources - nearly 90% of the earth's platinum reserves; 80% of the manganese, 73% of the chrome; 45% of the vanadium and 41% of the gold.

We are the fourth largest producer of diamonds and have huge deposits of coal of which we are one of the world's leading exporters.

South Africa's mining industry is a well established and resourceful sector of the economy, has a high degree of technical expertise and the ability to mobilise capital for new development.

It has provided the impetus for the development of an extensive and efficient physical infrastructure and has contributed greatly to the establishment of the country's secondary industries.

A large percentage of the JSE's turnover is resource based and it is the resources boom that enabled the JSE all-share index to reach a high of 33 310 on May 23. It is worth remembering that the JSE's all-share index was at 8 000 in 2001 and, to date, has remained well above 25 000 this year.

The high flying Shanghai Stock Exchange has lost 50% in the last nine months and the Mumbai bourse is down 30% this year.

There are two other areas of the South African economy that give me cause for optimism - investment by the public sector in infrastructure and the emergence of a black middle class.

I have been critical of Eskom but, unlike our northern neighbour, South Africa is responding to the challenge with investment. This year Eskom will spend R46 billion, next year R80 billion and by 2012 it would have spent R360 billion.

Transnet has announced plans to invest R80 billion over the next five years to expand its coal and iron ore export lines and maintain and improve the country's port and pipeline infrastructure.

We are spending R12 billion a year on roads and toll roads and, of course, there is the construction of all the World Cup stadiums.

Without doubt one of the great benefits to South Africa in the last decade has been the emanation of a black middle-class. In the US there is a saying "When America stops shopping you can turn out the lights".

The spending of our black middle-class has given South African retailers a prosperous ride over the past few years until interest rates and the National Credit Act started biting at the beginning of this year.

However, in a year or two interest rates will ease, there will be scope for tax cuts and consumption expenditure will rise again.

Despite the recent rally I can't help feeling that there are certain areas in our market where good value is beginning to emerge and I am sure that at present there are a number of investors who, working with a three to five year time frame, are starting to invest in companies that are beginning to look remarkably inexpensive.

Sadly no one rings a bell when the market bottoms and it is up to each and every investor to make this call.

Humphrey Borkum is Chairman JSE Limited

Originally published by Patricia Holburn, Money Marketing newsletter 24-07-2008 Confidence and Reasons for optimism

http://www.itinews.co.za/companyview.aspx?cocategoryid=55&companyid=22395&itemid=CD452DA4-C24A-46CB-81F9-3598853895E8

World cinema to see destination SA

July 24 2008 at 11:40AM

Cinema-goers around the world will be targeted in a global campaign to advertise South Africa as a tourist destination, SA Tourism said on Thursday.

SA Tourism said "destination SA" commercials would be broadcast to more than 1 770 cinema screens in Australia, France, Germany, the Netherlands, Canada, the UK and the US.

The commercials will feature two 60 second spots that "evoke the spirit of a welcoming, a breathtaking destination that offers everything from urban sophistication to unspoiled wilderness vista experiences".

The campaign launches next month in Canada and runs until February next year. The advertisements are aimed at global travellers especially, and will not be screened in South African cinemas.

"It forms part of a global destination campaign to grow awareness of South Africa as a holiday destination and to grow foreign arrivals."

Key travellers been targeted are those in Sydney, Melbourne, Brisbane, Perth, Paris, Munich, Frankfurt, Stuttgart, Cologne, Toronto, London, New York, Los Angeles, Boston, San Francisco and Chicago.

"These are consumers with sufficient income to travel and with a yearning to explore the world beyond the immediate environment of their own homes and cities."

The advertising drive is also aimed at the global news and actuality channels of CNN, BBC, Sky, Eurosport, ESPN and National Geographic.

Roshene Singh, chief marketing officer at SA Tourism, said the cinema commercial campaign was part of the organisation's larger strategy to boost visitor numbers over the next two to three years. - Sapa

^^ nice Roman article and well put.


.

R500m earmarked for State's IT infrastructure

By: Christy van der Merwe
Published: 28 Jul 08 - 12:24

South Africa’s State Information Technology Agency (Sita) planned to spend some R500-million on extending its infrastructure capability over the next three years, which would “cost more than [Sita] earns”, said CEO Llewellyn Jones.

However, he noted that the investment was imperative to offer efficient services to "make government great".

Commenting on funding for extending infrastructure capability, Jones said that Sita “could knock on National Treasury’s door, but our ambition is not to do that”.

Speaking at the opening of the 2008 Govtech conference in Durban, Jones stated that Sita’s strategic imperatives over the next three years included infrastructure optimisation, modernising public service operations, reducing costs, extending the agency’s service footprint, and focusing on internal operations.

Beyond those strategic imperatives, Jones said that Sita had the ambition to use its influence to help develop a local information communication technology (ICT) industry, and take it further. He added that smaller local companies would be given the opportunity to tender to provide services and solutions to government along with larger companies and multinationals. “We are going to be imposing those conditions on procurement,” he said.

Jones affirmed that South Africa had a number of innovative small to medium-sized and micro enterprises that Sita would like to allow to go through the larger framework, as the agency hoped to build the foundation for developing products and solutions that could be exported.

In the financial year ended March 2008, Sita reported a turnover of about R3,6-billion – about 10% of which was reinvested into the next generation network, explained Jones. The agency’s projected income for the current financial year was in the order of R4-billion, with about 10% of that expected to be invested in a wider range of hardware and software.

In the 2007/8 financial year, government spent some R303-million on software, about R9,4-billion on hardware, and R6,2-billion on ICT services, said Public Services and Administration Minister Geraldine Fraser-Moleketi.

She noted that delegates should not lose sight of the outcomes of this spend, and that automating processes within government was a vital imperative for service delivery rollout, and could speed up and simplify the delivery of social services, housing, education, transport infrastructure and so on. ICT should provide common ways for capturing requests, and tracking whether delivery has taken place, she said.

“We have the right to be impatient – lets do what we need to do quicker. We have gone a long way, but we are dealing with an incredible deficit, and we face a longer road ahead. We must make sure that we are willing to take on this challenge,” concluded Fraser-Moleketi.

R1bn new investment for Uitenhage auto park

By: Mariaan Olivier
Published: 28 Jul 08 - 14:54

The Nelson Mandela Bay Logistics Park (NMBLP), in Uitenhage, could soon have six new automotive component investors on board, its operator said on Monday.

The Coega Development Corporation (CDC), which recently took over the responsibility for the management and development of the automotive supplier park, said that it was in the process of concluding six investment deals worth more than R1-billion.

The investments would increase the total number of investors operational in the park to nine by March next year.

Four investors were currently operating in the NMBLP.

CDC said it was fast-tracking the construction of the factories, as existing original equipment manufacturers (OEMs) in the region would use the products to be manufactured in launching new products in the market. “There are tight timeframes for the delivery of the facilities,” it stated.

Meanwhile, the CDC said it was in “serious negotiations” with Indian and Chinese companies, which have expressed interest in bringing at least two OEMs to South Africa.

A big automotive contract manufacturing facility was also on the drawing board for zone two of the Coega IDZ as part of the CDC’s strategy to enhance the metro’s competitiveness and in attracting companies to enhance the auto cluster.

The Eastern Cape Province accounts for 27% of South Africa’s output in the sector with four OEMs and over 100 component manufacturers. 60% of the Eastern Cape’s automotive output is in the NMBM region.

Posted to the web on: 29 July 2008
Angloplat on R25bn expansion trail

Charlotte Mathews
Resources Editor

ANGLO Platinum (Angloplat), the world’s biggest platinum producer, has approved R24,8bn for new capital projects to maintain and expand production over the next few years, it said yesterday.

This brings the group’s project pipeline to almost R40bn. The biggest single project is the R16bn construction of the No 4 shaft at Amandelbult, to replace 271000oz of platinum a year. In the six months to June, Angloplat spent R5,8bn on capital projects and it will spend between R12bn and R13bn for the full year.

Angloplat’s investment demonstrates confidence in the future of platinum group metals prices, which have taken a knock in the past few weeks on fears of a slowdown in the global car industry.

CEO Neville Nicolau told analysts and media the fundamentals for the platinum market remained sound despite macro-economic developments and price volatility.

Demand from the car and industrial sectors was firm, although the more price sensitive jewellery market had weakened. Investment demand was expected to continue to underpin the price in the next six months.

Nicolau said Angloplat was targeting production of 2,4-million ounces of refined platinum this year and expected production to grow at 5% a year for the next few years. The group grew headline earnings 21% to R35,63 a share in the six-month period compared with the same six months last year, as strong platinum group metals prices and a weaker rand boosted gross sales revenue 17% to R27,5bn.

An interim dividend of R35 a share, compared with R29 a share last year, was declared.

Platinum produced from mining dropped 11% to 1,13- —million ounces because of flooding at Amandelbult, less material put through the concentrator at Mogalakwena South, rehabilitation at Rustenburg and reduced grades and power disruptions in January.

To meet contractual obligations to customers, Angloplat sold 111000oz of material from working stock.

The cash operating cost per equivalent refined platinum ounce rose 46% to R10498 as a result of planned lower grades and reduced production, as well as above-inflation increases in costs of inputs like labour, diesel and chemicals.

An analyst, who asked not to be named, said the average cost escalation in the platinum industry was 20%-25% , so Angloplat’s costs were high. Addressing costs should be on the list of management priorities.

Asked for guidance on costs in the second half, chief financial officer Norman Mbazima said it was not Angloplat’s policy to give an exact figure, but without the volume losses in the first half, costs would have risen by 17%. With increased production forecast in the second half, costs were expected to fall in line.

Nicolau’s ability to improve Angloplat’s safety record is under scrutiny after the departure of his predecessor Ralph Havenstein almost a year ago after a sudden escalation in fatalities on the Angloplat mines. Nicolau said yesterday the number of deaths had fallen to eight from 18 a year ago.

SA trade deficit down in June, boosts rand

By: Reuters
Published: 31 Jul 08 - 15:27

South Africa's monthly trade deficit shrunk to a one-and-a-half-year low of R180-million in June, below forecasts and boosting the rand currency and government bonds.

The South African Revenue Service said on Thursday the deficit narrowed from an already relatively low R1,66-billion in May, largely due to an increase in precious metal exports and a fall in vehicle and metals imports.

The smaller deficit should help ease pressure on South Africa's yawning current account gap, and may reflect a wider easing in consumer demand following a series of interest rate hikes over the past two years.

SARS said compared to the previous month, exports rose by 6,97 percent to R60,16-billion, while imports were up 4,22 percent at 60,34-billion, with minerals product imports - mostly oil - remaining the biggest driver.

Analysts said the decline was welcome and the trend should continue in coming months given lower oil prices.

"It's certainly good news and it's the second consecutive month of a low trade deficit. The last time that it was this low was in December 2006 when it was a very small surplus," Carmen Altenkirch, economist at Nedbank, said.

"With the oil price having come down slightly we should see slightly lower deficits over the coming months."

The rand firmed after the data was released, while government bonds extended gains sparked earlier by a lower-than-expected producer inflation release.

The currency was trading at 7,3460 against the dollar at 12:23 GMT compared to 7,3690 before the trade data came out and 0,66 percent stronger for the day.

The yield on the benchmark 2015 bond was 33,5 basis points lower at 9,105 percent, continuing a strong rally in July.

The lower trade deficit could help bring down South Africa's large current account deficit, which widened to a 26-year high of 9,0 percent of GDP in the first quarter of 2008.

But SARS said the cumulative deficit of R34,2 billion for the first six months of the year was still up on the R30,3-billion shortfall recorded for the same period last year.

American rail firm expands in SA
7 August 2008

American industrial company Wabtec Corporation is expanding its presence in South Africa by establishing joint ventures to manufacture, supply and service its products in the region.

The Wilmerding, Pennsylvania-based Wabtec Corporation is a global provider of value-added, technology-based products and services for the rail industry, manufacturing a range of products for locomotives, freight cars and passenger transit vehicles through its subsidiaries.

It also builds new switcher and commuter locomotives and provides aftermarket services, and has been operating in African markets for several years.

"By establishing a local presence in South Africa, we are making a commitment to expand our production and service capabilities in this growing market," Wabtec chief executive Albert Neupaver said in a statement this week.

The company has created Wabtec South Africa and FIP Brakes South Africa, both based in Kempton Park, to the east of Johannesburg, to boost its manufacturing presence in the region.

To ensure that the company's local operations are compliant with broad-based black economic empowerment requirements, it has selected a local company, Sibanye Brakes, as the minority partner in both the new operations.

Wabtec South Africa will manufacture, assemble and service Wabtec products in the region, including locomotive and freight car braking equipment, draft gears, transit equipment and electronics.

"The unit will also provide installation of Wabtec's electronically controlled pneumatic braking equipment on locomotives and freight cars for Transnet Freight Rail, the state-owned railway in South Africa," the company added.

FIP Brakes South Africa will manufacture friction products and provide customers with access to worldwide technological and research capabilities, through Wabtec's other friction operations in the US, Europe, Australia and India.

"We believe customers will benefit from faster response time and direct access to all of Wabtec’s products and services," Neupaver said.

SAinfo reporter

SA adopts digital migration policy
7 August 2008

South Africa's Cabinet has approved the Broadcasting Digital Migration policy for the country, which involves the conversion of television broadcasting signals from analogue to digital technology, while also approving the manufacturing of set-top boxes in the country.

The migration has been made necessary due to developments in telecommunications technologies, which enable a more efficient use of the radio frequency spectrum, as well as ensure better quality of pictures and sound.

Once migration begins, television users will have to purchase locally-manufactured set-top boxes, which convert the digital signal for use on currently available analogue TV sets.

The decision to promote local manufacture of the set-top boxes in high volumes will provide a boost for the local electronics manufacturing sector and help create additional jobs.

Subsidised set-top boxes
The government has also agreed to help approximately five million of the poorest television owning households, by providing up to 70% of the cost of set-top boxes and the households having to fund the balance.

Funding for this subsidy could possibly be sourced from the Universal Service and Access Fund.

In February 2007, the Cabinet agreed that the digital signal be switched-on on 1 November 2008, and the analogue signal be switched-off on 1 November 2011.

This allows for both the digital and the analogue signal to be broadcast concurrently for the period of three years, which is knows as the dual-illumination period.

According to the Department of Communications, it is on track to start broadcasting a digital signal on 1 November 2008 and will provide digital broadcasting and mobile TV by 2010.

Increasing access to information
Digital broadcasting enables providing services in a multiplicity of languages, thereby increasing access to information, while it will also allow viewers to access on-screen programme guides for the various channels.

The inclusion of a return path compatibility feature enables the user to send and receive messages through the set-top box, which could see them serve as important tools for access to government information and services in the future.

The feature could enable the provision of fully interactive e-government services over the digital network, such as accessing, filing and submitting various government-related forms, without the viewer having to leave the comfort of their own home.

It's going to be an interesting day when Analogue television is turned off.

Eish!!! :lol:

I have a feeling a large number of people who don't pay attention to the fact that they will be broadcast-less are going to be very angry and make fools of themselves, then most likely protest or something as a result.

SA to unveil R5bn tax incentives for large projects later this year

By: Terence Creamer
Published: 11 Aug 08 - 16:14

Agreement had finally been reached between the Department of Trade and Industry (DTI) and National Treasury on the structure of tax incentives worth R5-billion, which could be used to support large projects that meet South Africa's industrial-policy objectives.
Speaking at a briefing to report back on the recent Cabinet Lekgotla's economic, investment and employment cluster deliberations, Trade and Industry Minister Mandisi Mpahlwa said that the programme should be finalised in September.

The tax scheme, which would replace the now oversubscribed strategic industrial projects incentive, was part of a series of new industrial-financing measures being deployed following the adoption last year of a National Industrial Policy Framework (NIPF) and its associated industrial policy action plan, known as IPAP.

This new architecture had been informed by a comprehensive review of all of the business incentives introduced in South Africa since 1996, and Mpahlwa indicated that the tax incentive was but one component of a larger package for which some R10-billion would be made available over the next three years.

He indicated that the tax incentive would add a large-project dimension to the existing incentive suite, which was currently relatively modest in both size and reach.

At present, there were only a handful of cross-industrial schemes in place, with the most prominent being the R700-million Enterprise Investment Programme (EIP), launched earlier this year. Another industrial-upgrading scheme was reportedly under development.

DTI director-general Tshediso Matona said that the EIP, which was designed to support small and medium manufacturers, as well as tourism investments valued at between R5-million and R200-million, would be reviewed and that additional resources could be set aside based on market appetite and perceived effectiveness.

Both DTI and National Treasury were intent on ensuring greater conditionality so that taxpayers' money was not directed to projects that did not meet the NIPF's intentions.

Indeed, Finance Minister Trevor Manuel pointedly made this point last month, when, in denying persistent suggestions that he did not support the NIPF, made apparent his irritation with the DTI's handling of its implementation.

"Unless people can put a business plan on the table, that is costed and viable, where the benefits to all of us as citizens of the country are explained, you shouldn't expect us to give the taxes that you earn and pay over to the State to ill-considered proposals," Manuel said at a briefing held in Johannesburg last week to release of the Organisation for Economic Cooperation and Development's inaugural economic assessment report for South Africa.

He added that it was not about "blocking things that can make a difference", but about raising the bar.

TARGETED INCENTIVES GET A FACELIFT
Also emerging was an effort to redesign some of the existing industry-specific incentives, notably for the automotive and clothing and textile sectors, as well as to introduce a range of additional targeted programmes.

The new automotive support instrument, which would replace the Motor Industry Development Programme, was currently being canvassed with stakeholders, and could be unveiled either later this month or early in September, once it had been approved by Cabinet.

Mpahlwa reported, too, that a new support programme had been developed for the embattled clothing and textile sector, and would focus on technology upgrading and employment retention. He said that a concessional loan facility would be set up under the aegis of the Industrial Development Corporation to support this initiative.

Other targeted incentives were also already on offer for the call-centre sector, as well as for the film and television industry.

Seven call-centre investments had already received support, with Mpahlwa indicating that this could lead to the creation of 10 000 direct jobs in the sector over the next few years. He added that there were a number of additional applications under consideration, which could swell that employment creation number even further.

The Minister also announced that the NIPF and the IPAP would also be aligned to South Africa's three-year budgetary framework, with some R5-billion having already been set aside for industry incentives over and above the R5-billion tax incentive scheme.

Region’s big infrastructure push driving Newcastle expansion plan
By: Terence Creamer
Published: 8 Aug 08 - 0:00

Steel group ArcelorMittal South Africa was close to finalising the configuration and capital costs associated with the expansion of its long-steel production capacity at Newcastle, in KwaZulu-Natal. But it appeared likely that the project would no longer proceed on the basis of the creation of a ‘mega’ greenfield blast furnace as first mooted, and would instead be pursued as an incremental brownfield expansion involving two smaller furnaces.
CEO Nonkululeko Nyembezi-Heita said last week that it was still targeting 2011 for the commissioning of the projects, and told Engineering News that this would require construction work to begin on site during the course of 2009.

The group would be placing enquiries in the market soon for the main project components and the environmental-impact assessment was already under way.

However, Nyembezi-Heita would not be drawn on the final capital estimate, stressing that this could only be determined once the technical configuration had been selected. It was also only then that the group’s board, which had approved the principle of expanding long-product output at Newcastle, would be in a position to offer its final sanction.

The JSE-listed company was expecting to spend R5-billion between 2008 and 2011 on increasing capacity across its operations to a targeted level of ten-million tons a year, from a current nameplate of about eight-million tons a year.

It was expected that the bulk of this money would be directed toward the Newcastle expansion, which would include the development of a sixth blast furnace, as well as a new section mill and billet caster.

The group’s stated objective was to raise long-product volumes in line with expected demand growth for such steel arising on the back of what is expected to be a material and sustained infrastructure push across sub-Saharan Africa.

Indeed, Nyembezi-Heita noted that the company expected sub-Saharan African demand to rise from 12,7-million tons a year currently, to 18,2-million tons a year by 2014 and said that ArcelorMittal South Africa would also seek to raise its share of that enlarged market from 42%, to 46%, by 2014.

Given that infrastructure projects were long-product intensive, the company would continue to pursue its stated strategy of expanding long output, while adding value to its flat steel. In fact, it was expecting to spend about R3,6-billion between 2008 and 2011 on what it described as downstream value-adding projects.

But while the final Newcastle expansion plan was still to emerge, it was increasingly certain that the expansion would be coupled with a 130-MW cogeneration plant.

Nyembezi-Heita said that it had a tech-nical team working on the power plan, which would not only make it more energy self-sufficient, but could also support its carbon dioxide emission-reduction plans.

She revealed that it was engaging with State-owned power utility Eskom under its Medium-Term Power Purchase Programme (MTPPP), which offered a potentially lucrative initial price of 65c/kWh for any project able to reach commercial operation by 2012. In fact, the utility was hopeful of facilitating the introduction of about 3 000 MW of cogeneration power plants between now and 2012.

However, Nyembezi-Heita noted that the engagement was still at an early stage and that there were many details still to clarify.

She also stressed that there would probably be a lag between the start-up of the new Newcastle blast furnace and the commissioning of the power plant, which meant that it was having to consider a range of options to fill the gap that would exist both during construction and start-up.

The group, as one of South Africa’s 138 largest electricity consumers, was still subject to a 90% ration by Eskom, which was likely to be made mandatory once the power conservation programme was introduced later this year.

Already, it had sacrificed 120 000 t in the first half of 2008 as a result of the rationing. This was likely to increase to 180 000 t in the second half of the year, owing mainly to the fact that its power demands would increase as it completed it various reline projects.

Company president Luc Bonte, thus, confirmed that the full-year losses as a result of electricity shortages would be in line with its earlier guidance of 300 000 t.

The Newcastle cogeneration project did not as yet form part of the company’s R13,1-billion rolling capex plans for 2008 through to 2011.

It's going to be an interesting day when Analogue television is turned off.

Yes, housebreaking with televisions being stolen is going to go through the roof.

BTW this thread is kind of interesting to see what is going on. Not to sound a negative, but most of these investments dont necessarily mean things are getting better and better.

Conventional economic theory estimates about 15% of GDP needs to be reinvested every year just to maintain existing capital assets. GDP is something like R2000b, so this means essentially the first R300b invested just keeps us in the same place. Much more is needed for permanent expansion of production.

I personally have read a lot and done a lot of research about what is going on in the South African economy. It seems that there is a lot of negativity. Now what I am going to discuss is simply how the trends are expected to continue, and why SA's economy has the potential to be a great one. Of course speculation is what gets people into trouble (We just need to look at the oil price to know this).

1. ICT and electronics sector

Because SA has the largest economy on the continent, this is a breeding ground for a competitive market (of course by this we know that we get a raw deal from certain companies). But nonetheless, it leaves room for expansion. Because SA is "less first world" than more developed countries, it allows for companies to use this country as a test-lab so to speak (haha we are all guinea pigs). Lets not forget the legislation change of 2000 (or 2001?) which allows new companies to introduce themselves to the telecommunications sector - for example Virgin Mobile did this. And of course Neotel is now on the front! MTN have also gone on a mission to increase its fibre-optic network in SA to keep up with its growing customer base. More investment! :)

Did you also know that SA is one of the world leaders in revenue management, fraud prevention and many others especially in the banking industry, than the rest of the world?

2. Minerals and mining

Eish this is a sore one. Of course we get exploited...sigh. Exporting raw gold and it eventually getting sold back to us for 10 times the price.

Did you know that SA holds approximately 85-90% of the world's platinum resources? As well as about 40% of gold? This shows that mining is crucial to SA's economy, with around 60-70% of SA's mineral exports contributing to precious metals.

Of course there is another factor contributing to how well this sector is contributing to the economy - transformation (BEE and AA). With over 70% of miners (labout force) being black, and less than 10% of managerial positions being black, the government has set a target by 2009 for this to be well above 40%. This obviously contributes because these companies will need a facelift, and investor confidence should remain (which I am sure it will).

Lastly, I read that an Australian Minign Firm (can't remember which one) is planning to build an aluminium smelter in the Eastern Cape. This shows that investment is still in the pipeline in our country, since this particular one goes way into the billions of rands.

3. Tourism

Hello? Where else are you going to find the awesome climate that we have? Let's not forget out beloved weak rand which allows for a field day when it comes to tourists (value for money). Visitors to our country has risen dramatically since 1994 (end of the Apartheid regime), and if memory serves me correctly, it was sitting at around 8 million in 2007 - highest to date). The trend has risen year by year. Not only that, because of foreign firms taking interest into our country (as mentioned above), it is a playground for tourists here on business! SA is also a favourable destination of conventions.

Also, tourism when it comes to sports also plays a major role, with a significant percentage of tourists attributing to this. We had the 1995 RWC, 2003 CWC, 20-20 series last year, and of course the 2010 SWC.

4. Infrastructure of our country

Ideal for this forum :).

I don't know how many people here know of the seacom cable which is expected to go live sometime in 2009. It is a fibre-optic cable which will connect SA with Europe and Asia under the sea. And they are hoping that it will be complete as to assist SA in broadcasting the FIFA confederations cup in 2009 (which is taking place in SA)... So this is exciting news. The government has committed itself in sorting out the bandwidth problem of our country (it is simply too expensive). Hopefully this Seacom project will aid in this.

And need I mention Gautrain, the many road developmens going on, Sandton, Polokwane, Nelspruit....JHB cbd upgrade...Airport upgrades, stadiums etc etc...

And of course we all know about the electricity problem. This has opened room for more investment to aid our beloved Eskom in building new power plants and expanding our power network!

-----
There are others worth mentioning but these are the biggies.
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We also need to take into account the economic policies of SA. Tito did warn years ago for people in SA to STOP SPENDING MONEY THEY DO NOT HAVE!!! For example, buying KFC on a credit card. For goodness sake: say you buy a R40 meal on a credit card. In 6 months, you will have spent almost double that on your meal. It's insane! If it wasn't for the National Credit Act of 2006, the situation we having now would've been a whole lot worse. That is, people struggling to pay their debts. On average, SA'ns have disposable income of about 25% of their total income (that means on average 75% of income goes to tax, debt etc etc) whereas in the USA, the average is UNDER 0%. That is, on average in the USA, people owe more than they earn. This figure has dropped (25%) in our country, thanks to raising interest rates etc and it is likely to remain this way, if not drop for sometime to come. The demand for credit has also increased dramatically over the last few months.

Because SA is a developing country, investment and savings are crucial in weathering the storm of a global economic slowdown. And I hardly ever play the blame game, but one of the root causes of the global credit crunch is because a certain few mortgage salesmen and dimwits on Wall Street decided to get involved in certain 'criminal activities'. Sigh. Because we have a huge current account deficit issue, this leaves room for negative investor confidence. The only way to resolve this is to increase said investment and savings.

The government has also set a target for unemployment (which is apparently hovering at around 25%) to be halved by the year 2014. And they might well be on their way to achieving this. In 2000, about 60% of SA'ns were earning under R500 a month. This has dropped to around 45%.

Many challenges do still face our country though. These range from the political situation, an OUT OF CONTROL crime situation, to the fact that the gap between rich and poor is widening. I remember reading in the Cape Times that Deputy president Phumzile Mlambo-Ncguka said that this cannot be allowed (for both black and white "rich" class to get richer while the poor get poorer). Bottom line: poverty = crime. When you have nothing, you have nothing to lose.

With a mass exodus of skills (teachers, nurses, doctors, engineers etc etc etc) and an ailing education system, this country faces a massive skills shortage. It's a vicious circle because this fact means that the government needs to put more money into education - thus making it a rather expensive system. But we need not panic. I am certain the government has got plans in place - after all they cannot afford for Africa's leading economy to suffer a massive blow. The aforementioned deputy president launched a programme in which 30 000 people are being trained in various industries (tourism, hopsitality etc etc) especially for the upcoming 2010 SWC.

So while SA still faces many challenges, we must remember that we are still a developing country. I'm sure we know well of the incredible tensions leading up to the 1994 election, Chris Hani's assassination, the IFP and ANC clashes in KZN, the near fallout of the negotiations going on involving F.W De Klerk and Nelson Mandela, and the country convinced that there was indeed going to be a civil war. However, the election progressed and it is seen as a miracle that there was no war. Instead, the country has seen relatively outstanding growth - given the aforementioned situation. Love the guy or hate him, the presidency under Mbeki has certainly contributed to the growth we have seen.

And in some ways or another, it is a breeding ground for investment and opportunities in all sectors (such as the 'guinea pig' ideoligy mentioned earlier in this post). However, with the global economy in the state that it is (US sub-prime mortgage crisis etc etc) we will have to see what effect (and maybe how big) it will have on SA.

1. ICT and electronics sector

Because SA has the largest economy on the continent, this is a breeding ground for a competitive market (of course by this we know that we get a raw deal from certain companies). But nonetheless, it leaves room for expansion. Because SA is "less first world" than more developed countries, it allows for companies to use this country as a test-lab so to speak (haha we are all guinea pigs). Lets not forget the legislation change of 2000 (or 2001?) which allows new companies to introduce themselves to the telecommunications sector - for example Virgin Mobile did this. And of course Neotel is now on the front! MTN have also gone on a mission to increase its fibre-optic network in SA to keep up with its growing customer base. More investment! :)

Whilst the legislation is good in theory, in practise it has proved quite unsuccessful. ICASA have been doing everything in their power to block new telecommunications operators from setting up shop in SA. The only reason Virgin Mobile ever saw the light of day is because they piggy-backed off Cell C. Vodacom and MTN are also only building fibre networks due to a loophole.

Neotel, for example, was supposed to have been in existence in 2002, but ICASA managed to prevent that happening until 2006. Only recently have they been getting their act together.

But it is happening now :) Besides ICASA is a disaster anyway, with the internal crap that goes on, i.e. like all their staff leaving ... lol. But Neotel's competitors were indeed very smart, because us poor consumers were locked into 1-2 year contracts with them - simply because we had no choice. So Neotel's predicted market share inevitably dropped as a result ... sigh.

And of course the government has shares in the oh-so-awesome Telkom, it makes sense as to why there were delays. What really annoys me is that Telkom's infastructure was built using tax-payer's money...so they scored when they became privatised. The sick irony... :bash:

The keyword is of course government. The only reason we haven't seen any competition is because of Government delays. That Ivy Matsepe Cataburri bitch is the bane of our telecommunications existence.

lol...agreed. :) Didn't she crack some wise comment once about companies not being monopolised by "people who do not look like her" ...eish.

As a compulsive oil-price watcher, I have noticed that in the last month, we have seen the price drop from US$135 to US$113 today. Now as we all know, SA's price gets regulated (well, "regulated") on the first Wednesday of every month - basically done in arrears. So, we are likely to see a drop in the price of petrol of more than R1, and diesel R1.60 next month. As great as this sounds, many petrol station owners will suffer a loss (since they would've bought any remaining petrol at the older more expensive price), unless they allow their supply to run very low, or even run out until right before the Tuesday.

Makes me wonder what really is going on with the oil price. Sigh.

SA Q2 growth up as manufacturing rebounds

By: Reuters
Published: 19 Aug 08 - 12:29

South Africa's economic growth rate accelerated to an annualised 4,9 percent in the second quarter of 2008, official data showed on Tuesday, partly due to a rebound in the key manufacturing and mining sectors.

Statistics South Africa said growth on a seasonally adjusted and annualised basis jumped from a six-and-a-half year low of 2,1 percent in the first quarter, which resulted in part from declines in manufacturing and mining related to an electricity crunch.

On an unadjusted basis, South Africa's economy grew by 4,5 percent compared to the second quarter of 2007.

The quarter-on-quarter number was above the forecast from a Reuters poll of economists, which saw the economy growing by 4,1 percent.

"The numbers are good, they are respectable. I think they are good because we were coming off a low base, and now we are back on the growth trend," said Brait economist Colen Garrow.

"I think the market will be surprised, most analysts were forecasting the mid-threes for the year and we may well see closer to four percent."

The manufacturing sector, which contributes about 17 percent to GDP, rebounded to a 14,5 percent expansion in the second quarter after shrinking by one percent in the first, while mining expanded by 15,6 percent from a 25,1 percent contraction.

The mining sector took the brunt of electricity cuts which hit South Africa at the start of this year as state utility Eskom struggled to meet demand. Key gold and platinum mines were shut for five days in January.

"The economy is more resilient than we thought it to be, but there are constraints such as skills, capacity and power supply issues, which is an ongoing threat and a drag on the GDP growth," Garrow said.

The rand strengthened to 7,73 against the dollar at 09:53 GMT compared to 7,78 before the data was released. The yield on the benchmark 2015 government bond fell to 9,005 percent from 9,025 percent prior to the data.

http://www.engineeringnews.co.za/article.php?a_id=141048

Great article...

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Optimism in Dubai and Johannesburg

Delicious Digg Facebook reddit Technorati London Banker | Aug 22, 2008

I am in Johannesburg, South Africa, by way of Dubai. It is hard not be optimistic about the future of humanity having visited these vibrant, modern cities. They have their problems, but each in its own way stands testimony to the ability of humans as a species to adapt, collaborate and generate prosperity under good leadership despite – and perhaps because of – challenging circumstances.

First, Dubai. I never cease to be amazed by this city. Having very little oil, Sheikh Mohammed and his predecessors chose to use Dubai’s historic advantage as a trading port as the basis of growth and development. Having achieved world class status as a port, tourism hub, commodities trading hub, trans-shipment hub, technology/communications hub, and finance hub, the latest ambitions are to drive development as a centre of excellence for higher education and medical treatment – and then a space programme.

I would never, never bet against Sheikh Mohammed. I’m not sure he isn’t more successful at investing than Warren Buffett, were a dollar for dollar comparison of returns possible. Unlike Warren Buffett, the Sheikh does not invest in equity of companies with proven management, but creates whole companies and industries from scratch by driving high achievement throughout the Emirati community which he educates and appoints to managerial positions, and through attracting the best business talent globally. Dubai’s scale, sophistication and prosperity are proof he understands both leverage and results-driven management.

Is Dubai a bubble economy? Of course it is, but even when the bubble bursts the accomplishments and dynamic commercial skills concentrated in Dubai will persist and form a solid foundation for enabling future growth. My guess is that as the US and UK financial-based economies implode from debt-deflation, and their military influence in the Gulf recedes, Dubai will strengthen its network of trade and finance deeper into former Eastern Europe, Asia and Africa. Dubai will facilitate the investment capital flows that allow all of these diverse geographies to develop according to their internal political, economic and resource constraints.

A word about cronyism and the difference between the USA and Dubai. In the US the well connected can fail upward, with friends covering for them and promoting them and financing them to new ventures. George W. Bush’s whole miserable business career and cronyist administration of failed Nixonites is proof of that. In Dubai, you don’t fail because it would shame your family. I have seen young Emerati with no background in the businesses they were appointed to mature rapidly into good managers because the massive pressure of family and social connections demands that they not screw up when given an opportunity to perform.

The reward for good work is more good work, and Sheikh Mohammed only promotes those who have proven adept at managing the opportunities formerly provided to them. Being a small country that loves to gossip, he stays very well informed. Those who choose to be corrupt, lazy, selfish and self-aggrandising are given enough commercial rope to hang themselves, and then obligingly hung (metaphorically) as an example to others. Those who are diligent, professional, ambitious and productive are promoted, also as an example to others. Families gain status by producing good executives, reinforcing a family interest in educating and motivating their young. Those who fail can go into business for themselves, as there is no shortage of opportunity, and that saves the emirate underwriting their risks while it gains from new enterprise. I suspect the recent investigations of corruption at real estate and finance companies are based on good evidence, but the subtext of the very public inquiry is a warning to every manager in Dubai to remember that they owe their success and their loyalty to the leadership, family and community that put them in their current positions.

I once heard of Franklin Delano Roosevelt that in his administration, he owned the successes and the appointees owned the failures. That seems to me to be a reasonable way to motivate innovation and infrastructure development. It doesn’t fit with the bonus-centric incentive programmes so beloved of modern boardrooms and management consultancies, but as a means of engineering social prosperity through government programmes, it might have merits. FDR would not have renewed massive no-bid contracts with Halliburton’s KBR and others once they failed to deliver essential goods and services to wartime troops in a combat zone. FDR would not have appointed the delusional and incompetent Defense Undersecretary Paul Wolfowitz as president of the World Bank. Times have changed.

Perhaps Halliburton in Dubai will corrupt Dubai, or perhaps Dubai will reform Halliburton. Since Halliburton is moving its global headquarters to Dubai to evade US taxes, investigations and subpoenas, we will have the chance to find out.

Now to Johannesburg, where I stay in as comfortable a hotel as anywhere I’ve been. I drink the tap water – that says a lot in Africa. The food is excellent, with springbok shank and kudu steak new favourites.

I have been here every two years since 2004. Each time I am impressed with the rapid progress. There are problems, sure, but there are problems everywhere. The electricity grid failures in the early part of this year were a wake up call that the government needs to focus on the basics of infrastructure if it is to continue to provide growth and jobs to the vast population. Unemployment remains stubbornly high, at almost 40 percent. The refugees who have fled to South Africa from neighbouring Zimbabwe, add to the pressures (and explain why stabilising Zimbabwe is more important to the Mbeki government than confronting the egregious Mugabe).

When I first visited in 2004 there were still vast shantytowns around the capital. When I next visited in 2006 these had been largely replaced with neat little tract houses, each with plumbing and electricity. Now the housing boom is slowing, credit is tightening, but millions have homes they did not have before. That is a major achievement. Unlike America where huge houses are the norm, here the norm is much more modest and sustainable.

On learning I was in banking, my driver from the airport handed me an e-mail he had received quoting John Mauldin’s recent praise of South Africa:

Johannesburg is a world-class city, on a par with New York or London or any major city in terms of facilities, shops, infrastructure... and traffic. There were new shopping malls all over, and the stores were busy. The restaurants were excellent. The hotels I stayed in and spoke at were excellent and modern. The Sandton area is particularly pleasant.

Durban is a tropical jewel on the Indian Ocean. Again, there was construction everywhere - a green, verdant city of 1,000,000 people, with modern roads and great weather.

I have been to Sydney, Vancouver, and San Francisco. I love all of them. But for my money, Cape Town is the most beautiful city I have been to in the world. Amazing mountains, blue water harbours, white sand beaches, with wineries nestled in among the mountains and valleys. The Waterfront area, where I stayed, is fun and vibrant. Again, an amazing amount of construction everywhere, especially in the waterfront area, as investors from Dubai are pouring huge sums of money into creating a massive residential/business/ retail/restaurant development. There are several similar, quite large developments going up in different parts of Cape Town.

. . .

The simple fact is that as the world grows more prosperous we are going to need more grain and other foods. Where is the land we are going to need to feed the world? There is an abundance in Africa, along with the needed water and labour. And as African countries upgrade their infrastructure, it will improve the ability of farmers to get their grains to market at profitable levels.

There is much to like about emerging markets. That is where a great deal of the real potential growth in the coming decades will be. And South Africa will be one of the better stories. If you are not doing business there already, you should ask yourself, why not?

Mauldin offers specific praise for development of South Africa’s housing, retail, banking, commodities and farming sectors. I have never read a piece by him so optimistic about anywhere else, particularly in the developing world.

I thanked my driver for the Mauldin article, but suggested that the problems in the banking sector would cause problems for South Africa too. My driver then proceeded to detail his own preparations for a downturn in the economy: selling his old passenger van to pay off the newer one; paying off all his credit cards and keeping the balance at zero each month; delaying his purchase of a new house for at least a year while he sees what happens in property. This lone tour driver was more prepared for a shift in the economy than most of the bankers in the City of London. And if he reads John Mauldin, he is better informed too.

The group of bankers which showed up the next day for my workshop was another pleasant surprise. In 2004 the group was widely mixed as to backgrounds, race and abilities. In 2006 it was whiter and more professional, but also less friendly. In 2008 the group is blacker, more professional still, more experienced, more knowledgeable and universally friendly too. They are delightful to teach as they know enough to take in information readily and apply it to their careers and specialties. They collaborate readily, with clear trust and confidence in each other. Everyone is respectful and considerate.

I asked some neutrally each break about the challenges in South Africa, and they were uniformly optimistic. This is a big contrast to 2006, when the group complained about racial quotas, reforms and problems much more. One expressed concern about the potential damage of a corrupt government when Zuma takes over from Mbeki, and the others all nodded, but then he confirmed that the direction of change for the present remained for the better, and that it would take time to reform the ANC.

I have always believed that democracy can only really exist in those states with a large middle class. I do not subscribe to the view that democracy should be universal, as poor or rich are too self-interested to allow uncorrupted democratic government unless constrained by a middle class from abuses. As South Africa continues to grow at 4-5 percent each year (probably an under-estimate of real growth), the middle class continues to grow and prosper. So although a Zuma administration may hold risks, I hope there will be constraints on their policies as the already substantial and growing middle class enforces longer term discipline on the government.

I could not live in Dubai, but for the first time, I find myself looking around me and thinking I could live in South Africa. That says more about the optimism I feel here than any statistics.


http://www.rgemonitor.com/financemarkets-monitor/253398/optimism_in_dubai_and_johannesburg

A very heart warming article. :applause: to every south african who's making this country work.

Agreed! Woohoo for patriotic SA'ns. :)
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Some good and bad news! Source: http://www.fin24.com/articles/default/display_article.aspx?ArticleId=1518-25_2382145


Johannesburg - There is no real evidence of a drop-off in capital projects and large projects in the pipeline will keep investment in South Africa robust in the short term.

This is the view of Nicky Weimar and Dr Dennis Dykes, economists from Nedbank, who released their Nedbank Capital Expenditure Report on Monday.

"There is no real evidence we have seen a drop-off, apart from Alcan/Coega," said Weimar.

She felt that infrastructure plans should improve export capacity, with this being positive for economic and jobs growth.

Dykes said that the outcome of the finding was surprising, but pointed out that it related purely to the calculations undertaken in this research and there could be smaller plans that were shelved and never reported and that the picture could change. The survey zones in on projects valued at R20m or more and were in the public domain.

The research shows that 80 new projects were announced in the first half of 2008 to the value of R336.1bn.

"The sharp rise in value of new projects announced is mainly due to major extensions to Eskom's capacity expansion programme announced in this year's national budget. However, excluding Eskom's programme, capital expenditure remained strong," said Weimar.

In the case of the private sector, 64 new projects worth R72bn were announced in the first half of the year, with finance and real estate accounting for R38bn of these projects.

The manufacturing sector also featured strongly with new projects of R25bn compared with R15bn over the same period last year.

Power crisis

Weimar noted that mining projects worth R6.5bn in the first half from R49.7bn in the whole of 2007 and R27bn over the same period last year were "still respectable" as they were coming off such a high base.

The power crisis was highlighted as a potential factor behind the lower levels, but Weimar noted that some major mining projects were in the pipeline.

Dykes said the research suggests that 11% investment growth could be expected this year. He added, though, that to sustain 6% GDP growth capital formation has to climb to 25%, which would translate into net fixed investment of about 13%.

"Much of which would have to be financed with foreign capital," he cautioned.

Said Weimar: "Companies are looking further into the future and saying China and India will be around for a while and there will be demand for commodities and that they need to be in a position to take advantage when the cycle turns."

She said while they are currently looking past the cycle, a key concern would be if this picture changes.

And Dykes added that currently there are still major infrastructural constraints on the export front.

Bad news

But he conceded that there is demand for final goods and the key was now to get the organisation in place.

"It is not a demand issue, but an organisational issue - the bad news is there is a lack of capacity when it comes to those organisational skills."

Dykes has revised his 2008 GDP forecast to 3.5% from a previously expected 2.9% due to higher than expected second quarter data of 4.9%.

Japanese workhorse leads vehicle manufacturer's SA growth charge

By: Jonathan Faurie
Published: 22 Aug 08 - 0:00

The Quon, a popular extra-heavy commercial vehicle (EHCV) in Japan, is set drive the growth of commercial vehicle manufacturing company, Nissan Diesel, in the local commercial vehicle market, reports the company.
Nissan Diesel South Africa COO Johan Richards reports that the Quon is Nissan Diesel's flagship truck in the Japanese EHCV market where the company holds a 26% market share in the heavy truck market with payloads over 8-t.

"Since the launch of the vehicle on the local market in March this year, the company has sold, 600 vehicles," reports Richards.

He adds that this can be attributed to the fact that certain aspects of the Quon have been modified to suit South African conditions, and that the vehicle is based on the framework of another popular vehicle in the Nissan Diesel range.

Richards reports that the design of the Quon is based on the UD440 range of extra-heavy trucks that was launched by Nissan Diesel six years ago. "These trucks have proved themselves in some of the toughest operating conditions, and have surprised customers with their ability to consistently deliver low operating costs," says Richards.

He adds that the Quon line-up includes nine model variants, six of which were launched between the end of March and May, one more which will be launched in September, and the final model, which is due to be launched in February next year.

Nissan Diesel's Quon range consists of 6X4 truck tractors that are especially used for medium-haul or long-haul freight transport, 4X2 truck tractors for specific use in the retail and fresh produce industries, 6X4 freight carriers and tankers, as well as 6X4 tipper and mixer models aimed specifically at the construction industry.

"The introduction of the Quon was preceded by the UD430 and subsequently the high specification UD440 extra heavy models. A lot of lessons were learnt with regards to what customers expect from an extra heavy truck, and Nissan Diesel has since been involving its customers in developing products that are suitable to local operating and market conditions," says Richards.

Local input
Richards reports that focus areas in the alteration of the Quon to suit South African conditions included driver comfort, driveability, clutch systems, steering and gear changes.

A stronger and larger cab, which is 100 mm higher than the UD440, contributes to improved driver comfort, while being more aerodynamic than the UD440. The cab suspension has been improved and the cab tilt angle has been increased to 1651 mm to make maintenance more convenient.

These cabs are quieter, offer more space and storage room, with easy access to controls. Further, the long-distance high roof versions incorporate a double sleeping bunk that was developed locally.

Nissan Diesel South Africa reports that a range of tests and simulations were carried out locally to ensure the durability of the units which have a minimum standard life of ten years.

Before the Quon was introduced to the South African market, Richards reports that the vehicle underwent an extensive range of performance tests, including on-and-off road capability tests, tests for performance at altitude and at sea level, and performance under high and low temperature conditions. Secondary conditions such as dust and pollution where also taken into consideration.

Future outlook
Richards is confident that the Quon will be the vehicle to drive the company's future growth in the market.

"The company wants to be seen as the preferred supplier of heavy-duty vehicles (HDVs) to the heavy commercial vehicle market. This will not be easy as the local commercial vehicles market is highly competitive. In Japan, where Nissan diesel holds a 16% of the HDVs market, there are four companies offering similar products. In South Africa, there are 30," says Richards.

He says that this goal will be driven by a number of capital expansion projects which the company has initiated.

The most significant expansion project is the upgrade of the company's production facility in Rosslyn, east of Pretoria.

Richards reports that when the company opened its original facility in 2002, the company was able to manufacture about 2000 units a year, which later increased to about 5 400 units a year. Richards says that the R10,9-million upgrade has increased the facility's capacity to about 9 000 units a year.

African expansion
Richards comments that another way for the company to achieve its goal of being the preferred supplier of HDVs to the commercial vehicles industry is to develop its international performance and increase its African footprint.

Through its dealer network, the company currently distributes trucks to Angola, Malawi, Mauritius, Mozambique, Zambia and Zimbabwe.

"According to statistics released by Nissan Diesel in Japan, Nissan Diesel South Africa is the top performing international market in the company's group. Nissan Diesel South Africa hopes this reputation will drive the company's growth into untapped African markets in West and Central Africa," says Richards.

Nissan Diesel sells into neighboring markets such as Botswana, Lesotho, Namibia and Swaziland, but regards these as local sales and not African sales.

Skills crisis resolution
Richards reports that the current skills crisis, which is affecting many companies in South Africa, has not had a significant effect on Nissan Diesel. It has, however, affected the company's dealer network.

In an effort to reduce this effect, the company has established an extensive skills training programme.

"The skills training programme trains about 800 people a year and covers technical training, parts and accessories sales training, product related training, and operator training," says Richards.

He adds that, although the skills crisis has not had a significant effect on the company, the commercial vehicles industry, especially the diesel market, is perceived as an unattractive industry to enter into. In an effort to increase the industry's popularity, the company has identified a schooling programme where the company identifies children from underprivileged communities and offers them schooling. Once the learner has completed his or her schooling they are employed by Nissan Diesel South Africa for a period before completing a trade test. This programme will soon be introduced.

Richards reports that employees from Nissan Diesel South Africa are also benefiting from a programme aimed at improving their education levels. Should a employee wish complete his or her schooling, the company will provide the means to do so.

"Employees also receive extensive training on the Nissan Diesel products. In the past, select employees have been sent to Japan where they work for six months getting to know the business processes of the company," concludes Richards.

Unemployment rate declines
Thursday, 28 August 2008

South Africa's unemployment rate declined from 23.5 percent in the first quarter of 2008 to 23.1 percent in the second quarter of 2008, Statistics SA said on Thursday.

The number of people out of work dropped to 4.11 million from 4.19 million, the agency said in its quarterly Labour Force Survey.

Over the two quarters, the percentage of persons in the South African working age population with jobs was 44.5 percent in the first quarter of 2008 and 44.7 percent in the second quarter of 2008, Statistics SA said.

More than half of all unemployed persons (58.5 percent in the second quarter of 2008) have been looking for work or trying to start a business for one year or longer.

Sapa.

Yesterday's City Press ahd Professor Ncube's article with 12 points that South African should follow to be on par with Brazil, India, China and Russia.

He's 12th point was that South Africa should build the tallest building in Africa or commit to massive projects like it did with Gautrain as that will be a sign of hunger for power and wealth. That will send a message to the outside world that we mean business and we ready to hold the bull by its horn. Note that I didn't quote him cause I don't remember word to word of what he said but this is exactly what he meant.

Man, I agree with the Prof. South Africans are too modest and a bit hesitant to take a lead to do something really big. Joburg is our prime city and needs an iconic supertall, not only to compare with other african cities, but with the world.

^^ if you watch Megastructures on National Geographic, with all the buildings they build in the fincial districts in China, Dubai and Bahrain, the commentator always mention the fact that this buildings symbolises power and it send messages to the world that the specific country has arrived and its ready to take over the world.

I thing Kopanong, Gauteng Provincial Government's Precinct, should have been a skyscraper.

South Africa and Venezuela oil deal? Anyone with more details? Seen on CNN news headlines but no further details mentioned.

South Africa and Venezuela oil deal? Anyone with more details? Seen on CNN news headlines but no further details mentioned.

Bashu, you cannot expect CNN to report on that at all. They are Americans and you know that Hugo and Bush are not even close to be talking partners.



Chavez says Venezuela should supply oil to SA


By: Chanel Pringle (http://www.engineeringnews.co.za/author.php?u_id=1018)
Published: 2 Sep 08 - 18:15

Venezuelan President Hugo Chavez on Tuesday said that it was high time that his country started delivering oil to South Africa, and that this would promote South-South relations.

Speaking at the Union Buildings in Pretoria, during his first State visit to South Africa, he also said that South Africa's national oil and gas company, PetroSA, should "immediately" go into Venezuela to exploit the assets that it had acquired there.

Last week, newswire Reuters reported that PetroSA had held high-level discussions with its Venezuelan counterpart on projects including oil exploration and the production of heavy crude oil.

Ministers from Venezuela and their South African counterparts signed a number of energy cooperation agreements on Tuesday, which South Africa's President Thabo Mbeki said would pave the way for the countries to enter into detailed negotiations.

Mbeki told journalists that the two countries were looking at eventually eliminating the intermediaries and allow for direct State-to-State contact regarding the supply of oil, which would remove elements of cost. Cost and price structures were, however, still to be developed.

Both Presidents agreed that cooperation between the two countries would be strategic in nature and that the countries should endevour to draw lessons from each others successes and failures.

Mbeki added that South Africa and Venezuela would also look at concluding an economic-cooperation agreement before the end of the year.

In future, the countries would also discuss frameworks in the telecoms and ICT sectors, as well as in the areas of arts and culture.

awesome news. atleast if this goes ahead were not screwed if the US rapes Iran.

On the super tall thing. how about a 150 floor mega building on parkstation. redevelope the area. get a bank and mtn to be anchor tennants. 20 floors as a hotel. residential and a retail mall with the most upmarket shops and chains in the world. build a park over the rail lines. joburgs central park with a arts centrum in the middle (a architectural marvel hosting shows for all kinds of music) .
would become the number one address in the world. a tourist attraction on its own.

gotta love this, supplying to the world our vehicles;
Mine-protected vehicles for Spanish army to be manufactured in SA

RG 31 Mine protected vehicleBy: Christy van der Merwe
Published: 3 Sep 08 - 17:43
Defence company General Dynamics European Land Systems has been awarded a €64,6-million contract by the Spanish government to supply RG 31 Mk5E mine protected vehicles for the army.

The prime contractor General Dynamics Santa Barbara Sistemas would provide programme management, engineering and logistic support, while the vehicles themselves would be manufactured and supplied by Benoni-based BAE Land Systems OMC of South Africa.

The contract called for the delivery of 100 vehicles – 85 armoured personnel carriers (APCs), ten ambulances and five command post variants – plus integration of remote controlled weapon station turrets and ongoing integrated logistic support.

Work under the contract was expected to be completed by 2009. The contract included an option for a second phase for 80 additional vehicles that would include some manufacturing in Spain.

The RG-31 Mk5E is a 4x4 armored vehicle with a combat mass of up to 17 000 kg, including 3 500 kg of payload. In standard APC configuration, the air-conditioned vehicle carried a crew of 10 (driver plus nine). It is in service with many other countries including the US and Canada and has been operating in Afghanistan and Iraq.

General Dynamics Land Systems-Canada has a similar programme with BAE Systems Land Systems OMC for the manufacture of this vehicle.

The BAE Land Systems OMC facility in Benoni has benefited from upgrades to the tune of about R10-million a year for the last three years, and this has increased production capacity at the facility greatly. The factory was currently able to produce about four RG31 vehicles a day, and was ramping this up to reach production of eight vehicles a day by December

Here we go Bashu


Venezuela invited to invest in PetroSA’s new Coega refinery

By: Chanel Pringle
Published: 3 Sep 08 - 18:03

National oil and gas company PetroSA has qualified as an operator in Venezuela for offshore gas exploration, while its Venezuelan counterpart, Petróleos de Venezuela S.A. (PDVSA), has been invited to participate as an investor in the proposed crude oil refinery at Coega, PetroSA revealed on Wednesday.

PetroSA, headed by CEO Sipho Mkhize, announced details of the agreements it had signed with its PDVSA, on Tuesday, during Venezuelan President Hugo Chavez's inaugural visit to South Africa.

The South African and Venezuelan governments had signed a number of official trade agreements relating especially to energy during Chavez's visit.

The two countries' national oil companies (NOCs) had discussed a "strategic integrated proposal" as a framework for cooperation in the area of oil and gas, PetroSA said.

The proposal addressed a number of issues, including PetroSA's participation in exploration and production activities in the Orinoco Oil Belt, in Venezuela, where the company would conduct a study to quantify and certify reserves in the Boyaca 4 Block.

Further, PDVSA had been invited to participate in a joint investment with PetroSA in the proposed crude oil refinery planned for development at Coega, in Port Elizabeth, as well as associated storage facilities in South Africa.

Construction on the 400 000 bl/d crude oil refinery at Coega was expected to start in 2010 and come on stream in 2014.

Meanwhile, the Venezuelan company had also been invited to use South Africa's crude storage facilities in Saldanha, which had a storage capacity of 45-million barrels of oil, for possible transshipment to Asia and the Far East.

With regard to gas, PetroSA had offered to share its low-temperature gas-to-liquids technology with PDVSA, which could use it to commercialise its Venezuelan gas assets.

PDVSA has also been invited to evaluate the possibility of acquiring an interest in PetroSA's exploration assets in Africa.

"As the South African NOC, PetroSA is aggressively pursuing all petroleum initiatives which serve to promote oil and gas development and production with a view to ensuring security of supply for the country," the company said in the media release.

i wonder who the other bidders or invited partners for the refinery were?

S Africa plans to stop blackouts

Traffic from the Nelson Mandela Bridge, which links Johannesburg's northern suburbs with its city centre - taken by a photographer at The Star newspaper
Power cuts knock the traffic lights out causing chaos at rush hour

A massive investment in new energy in South Africa is needed to prevent more power cuts, according to a senior government minister.

The Public Enterprises minister, Alec Erwin said that new power stations must be built, some of them nuclear.

An investment of at least 1 trillion rand (£72bn) was needed to secure a reliable electricity supply, he said.

An above-average demand for electricity and a lack of investment has led to an energy shortage in the country.

He acknowledged that the recent supply problems and blackouts had become familiar challenges in South Africa.

Global shortage

However, he said the energy crisis was a global problem, with many countries struggling to attract investment for renewable energy and a global shortage of power-generating infrastructure.

The building programme in South Africa will take over eighteen years to complete, with two new power stations due to open in 2012 and 2013.

The programme aims to add 40,000 MW to South Africa's generating capacity, with half coming from nuclear power.

In the meantime Mr Erwin made a call for greater energy-saving initiatives to reduce demand, and said it was important for South Africans to make a real effort to reduce their electricity use.

"There is no quick fix," he said, "but we can alleviate the problem with energy efficiency."

SA leads Africa in WEF Financial Development Index

afrol News (http://www.afrol.com/articles/30724), 9 September - World Economic Forum today launched the world's first Financial Development Index, a rigorous, comprehensive analysis of financial systems and capital markets in 52 countries that analyses key drivers of financial system development and economic growth in developing and developed countries.

United States narrowly edged United Kingdom to take top position in the Financial Development Index. The US and United Kingdom have close rankings, outstripping remaining countries in the top 10 - Germany, Japan, Canada, France, Switzerland, Hong Kong SAR, Netherlands and Singapore.

Highest ranking African nation is South Africa at 25. Other African countries that have made the list are Egypt (37) and Nigeria (50).

The Financial Development Report 2008, which promotes the full potential of financial systems to drive economic growth in developing countries, provides a ranking of 52 of the world's leading financial systems through which countries can benchmark their performance and evaluate priorities for reform.

The rankings are based on over 120 variables spanning institutional and business environments, financial stability, and size and depth of capital markets, among other factors, in assessing the complex financial systems of the 52 countries studied.

An important and unique measure captured by the Index includes the degree to which businesses feel they can easily access capital.

Report draws on data taken from a variety of publicly available sources as well as the World Economic Forum's Executive Opinion Survey, a comprehensive annual survey conducted by Forum with its network of partner institutes.

Some countries, such as Mexico and Peru, perform better with respect to foundational requirements of sound regulation and the low cost of doing business; yet they have not been able to fully transform these strengths into robust financial intermediaries and markets, said forum's report.

"China and Egypt do not seem to demonstrate an ease of access to capital that is commensurate with the overall depth of financial assets in their countries. By contrast, the United Arab Emirates seems to provide strong access to capital for its businesses despite a relatively lower ranking with respect to its depth of financial assets," concluded statement by World Economic Forum.

By staff writer

© afrol News

Inflation set to dive in 2009


Johannesburg - The inflation debate has taken a very welcome turn in recent weeks. Since the end of 2006 almost all influential opinion leaders across the economy, as well as factual reports on inflation trends, have painted a gloomy picture.

The relentlessly rising oil price, imbalances between food production and the demand for grains, in particular, as well as hikes in the prices of other raw materials, have been pointed out with monotonous regularity.

Food and raw materials

No country in the world has been spared this rising inflationary trend.

Even England - the world's fifth-largest economy and a country that for about a quarter of a century experienced pricing stability - has not been able to sidestep the deadly combination of higher energy costs, higher food prices and the escalating raw materials cycles.

In July these factors also caused British producer prices, on a year-on-year basis, to notch up double-digit growth for the first time in more than two decades.

Other countries in Europe have also experienced sharp increases in producer prices, but amid the systematic and relentless push of service sectors as the principal drivers of economic expansion and growth, consumer prices in Western Europe have risen only marginally.

In most developing countries the primary sectors and manufacturing still play a far greater role in overall economic activity, and it's not surprising that since last year inflation has risen steeply in almost all emerging countries. In some cases it has even doubled. In South Africa's case, the weakening of the rand between the end of last year and the middle of this year has naturally contributed to inflation rising more than in countries with a more stable and stronger currency.

The turnaround

Economists will, however, be delighted with the news that producer prices in England came down in August.

Although the year-on-year figure is still above 9%, the country's core producer price index also fell in August - for the first time since 2005.

Several economic analysts have been caught on the wrong foot by these favourable developments.

There had been an expectation that high inflation would continue, owing to the so-called "drag" effect.

If producer prices continue to fall, consumer prices will probably also soon begin to fall on a month-to-month basis, which one hopes will lead to a turnaround in negative attitudes towards inflation expectations.

Unfortunately there is still a dark cloud hanging over the picture - namely wage demands from the unions.

One of Germany's largest trade unions (IG Metal) is currently insisting on a 7 to 8% wage increase.

Unless these demands are adjusted to a more realistic expectation for inflation, or they keep pace with increases in productivity, it will take longer before inflation falls back to the levels seen early last year.

The essential reason for the sudden and sharp turnaround in inflationary trends can be ascribed mainly to real declines in the prices of resources.

After years of continual rises in the prices of energy sources, food, fertilisers, precious metals, steel and other raw materials, almost all resources have fallen back between May and August, as the accompanying table clearly indicates.

Fertiliser and timber products are among the few exceptions. In most cases resources fell even further during the first week of September.

On Monday, the oil price dropped below the $100/barrel level, 32% lower than its record price two months ago.

Even were resources prices to stabilise at current levels in the coming months, it is clear that the back of inflation has more or less been broken.

Although the higher interest rates we saw earlier this year will persist for several more months on an annualised basis, month on month increases should begin to trend towards zero, even becoming negative.

Low interest rates

In the case of South Africa, the prospects for significant declines in interest rates or becoming rosier. In addition to the universally positive effects of lower oil and food prices, the rand has strengthened in recent months and in January a bonus is on the cards for consumers (and homeowners) when the new system for measuring consumer expenditure comes into operation.

It's strange that Statistics South Africa should decide to wait until next year before using the new basket of goods and services representing household expenditure to calculate the consumer price index (CPI). (The country's authorities are in the habit of putting off decision-making - such as in the case of new power stations, the upgrading of Durban's port, and the operations of the Land Bank.)

It has become clear that inflation will drop in January, probably by more than two whole percentage points, following a technical alteration to the CPI.

If the current composition of the CPI basket is examined more closely, it's clear that South Africa's inflation rate could drop like a rock early next year.

The groups for food, housing and the running costs of vehicles (mainly fuel) make up considerably more than half the average South African's total expenses.

Declines in the cost of food and fuel are already evident, while lower interest rates will naturally lead to a reduction in the cost of housing.

Interest rates should therefore be systematically reduced next year, and a return to a 5% economic growth rate is just around the corner.

SA climbs ease of business rankings

11 September 2008

South Africa climbed from 35th to 32nd place in the World Bank and International Finance Corporation's Doing Business 2009, an annual survey of the time, cost and hassle involving in doing business in 181 countries around the world.

The survey tracks indicators of the time and cost involved in meeting government requirements in business start-up, operation, trade, taxation, and closure. Not measured are variables such as macroeconomic policy, quality of infrastructure, currency volatility and investor perceptions.

Paying taxes, starting a business
South Africa's move up the rankings was thanks to big jumps in the sub-categories of paying taxes (up from 65th to 23rd place) and starting a business (57th to 47th place).

"In South Africa, entrepreneurs starting a business no longer have to obtain legal assistance or have their incorporation documents notarized, thanks to amendments to the Corporate Act," the report states. "These amendments also allow electronic submission of documents and publication, easing business start-up.

"In addition, the government reduced the tax burden by eliminating the regional establishment levy and regional services levy."

South Africa is also a strong performer when it comes to getting credit (2nd overall) and protecting investors (9th overall), but weak when it comes to ease of employing workers (102nd) and trading across borders (147th).

Record reform year for Africa
According to the survey, Africa had a record year for regulatory reforms that make it easier to do business, with 28 African countries completing 58 reforms and four countries - Senegal, Burkina Faso, Botswana and Egypt - placed in the top 10 regulatory reformers.

Mauritius was the continent's top performer for the year, moving up to 24 on the overall rankings, with South Africa the second most business-friendly African country at 32, followed by Botswana at 38.

Singapore still top
Singapore maintained its position as the overall top-ranked economy for the third year running, with New Zealand, the US, Hong Kong and Denmark completing the top five and the United Kingdom, Ireland, Canada, Australia and Norway completing the top 10.

"Economies need rules that are efficient, easy to use, and accessible to all who have to use them," Michael Klein, World Bank/IFC vice-president for financial and private sector development, said in a statement on Wednesday.

"Otherwise, businesses get trapped in the unregulated, informal economy, where they have less access to finance and hire fewer workers, and where workers lack the protection of labour law."

The aim of the Doing Business survey was to encourage good rules, Klein said, adding: "Good rules are a better basis for healthy business than 'who you know'."

SAinfo reporter

SA sets R400m aside for hydrogen-economy push

By: Esmarie Swanepoel
Published: 16 Sep 08 - 18:44

The South African government launched a hydrogen and fuel cells research strategy, as part of a drive to build a value-added manufacturing platform around its platinum group metals resource base.

The State would invest some R400-million over three years and it was envisaged that 80% of the funding would be channelled towards technology and expertise development, while the balance would be used to stimulate private sector research.

Through the initiative, South Africa would seek to supply 25% of global catalyst demand by 2020, as well as build on its existing knowledge of high temperature, gas-cooled nuclear reactors and coal gasification technology in order to develop hydrogen solutions.

Three centres of excellence have been established, covering catalyst development, hydrogen infrastructure, and systems integration. These centres would be run by tertiary education institutions and research organisations, such as the CSIR.

Science and Technology Minister Mosibudi Mangena called on industry and the private sector to invest in these centres of excellence, one of which was based at the North-West University.

The Department of Science and Technology was currently in negotiations with Johnson Matthey and Anglo Platinum in a bid to win their support for the venture, while State-owned enterprises Eskom and PetroSA had already made substantial investments.

BAE launches new version of SA-manufactured armoured vehicle

By: Christy van der Merwe
Published: 16 Sep 08 - 17:00

BAE Systems’ South African business, Land Systems OMC, has launched the RG31 Mk6E, which would debut at the African Aerospace & Defence 2008 show in Cape Town on Wednesday.

The RG31 Mk6E is the latest version of the company’s explosive mine resistant personnel carrier RG series of vehicles, which are manufactured in Johannesburg.

The RG31 is a 4x4 mine-protected vehicle with a V-shaped hull that protects the crew against anti piercing rifle fire, anti-tank mine detonations, and a number of improvised explosive devices.

“We are confident that this latest development, will further entrench our South African business as the world’s leader in mine protected vehicle technology,” said Land Systems South Africa MD Johan Steyn.

Among the latest developments incorporated in the RG31 Mk6E were new anti-mine seats, which provide enhanced protection to the occupants from lumbar spinal injuries caused by the shock-waves associated with land mine detonations. The seats incorporate shock attenuation crushable elements developed at Land Systems OMC. Tests have shown that these absorb some of the vertical impulse associated with mine blasts, reducing the likelihood of injury during large landmine explosions.

Earlier RG-series vehicles could also be equipped with the new seats.

Land Systems OMC’s RG-series of products have boosted South African exports by more than R3,5-billion, since the company received a Canadian armed forces order for RG31 Mk3 vehicles in 2003. Steadily increasing orders for vehicles, spares and support from new customers around the globe have also boosted exports.

“The RG series builds on the three decades of experience we have gained in South Africa, through vehicles such as the Casspir, Mamba and Mfezi. Its success is a result of our ongoing investment into ever improving the vehicle’s protection levels. We achieve this by applying new concepts and designs influenced by customer and operator feedback and simulation,” explained Steyn.

Since 2004, Land Systems OMC has sold over 2 200 RG31 vehicles, including a series of major orders for the US military, which operates both the RG31 and its stable-mate RG33, in Afghanistan and Iraq. Of these, more than 1 300 RG31 mine-protected vehicles have been delivered to the US and Canadian forces. Another 984 RG31 Mk5E vehicles were currently on order with production under way at Benoni and partners in the US.

“In addition to ongoing US orders, several European countries are expressing interest in RG31 mine-protected vehicle for their forces,” the company said.

NEW DUBAI POLICE FORCE CONTRACT SECURED

BAE Systems on Tuesday also reported that it has secured a contract for ten RG12 Mk4 armoured personnel carriers from the Dubai Police force, which already has six RG12 vehicles in service.

The Mk4 vehicle was the latest version of the RG12, and features a new engine with more horsepower and torque, and revised axles with disc brakes on all wheels for improved braking performance. A digital electrical system was designed to improve the maintainability of the RG12 through the use of a plug-in diagnostic computer.

The 4x4 RG12 was originally developed as an internal security and public order vehicle, and has proved effective in a number of other applications such as command vehicle, and as an armoured personnel carrier. It carries a driver, commander and between eight and ten personnel. The welded all-steel armoured hull, which gives improved protection against small arms fire, firebombs and hand grenades, is of monocoque construction.

”There are currently more than 830 RG12 vehicles in service with various customers around the world, including the South African Police Service and the Italian Carabinieri,” said Land Systems OMC GM Thami Mbele.

Private aviation group works on own attack-helicopter design

By: Martin Zhuwakinyu
Published: 12 Sep 08 - 9:00


http://llnw.creamermedia.co.za/articles/images/resized/50758_resized_photo_5.jpg
IN CONCEPT PHASE A front view of the New Attack Helicopter


South African aviation and defence company Advanced Technologies and Engineering (ATE) has embarked on conceptual planning for the development of what is to be known as the New Attack Helicopter (NAH), external affairs director Lorris Duncker tells Engineering News.

This comes on the back of the successful upgrade of the Russian-made Mi-24 helicopter, now in production for the air force of a North African country and the demonstration of another upgraded Russian stalwart – the Mi-17 combat helicopter – to an unnamed potential customer.

The Mi-17 upgrade entailed the night vision goggle-compatible conversion of all cockpit and cabin lighting, external navigation and formation lighting and the inclusion of infrared landing lights. It also included the installation of glass cockpit avionics, a sighting system and a weapons system that incorporates twin 23-mm cannons in pylon slung pods, eight Ingwe missiles on stub-wing outboard stations, rocket pods and chaff and flare countermeasures.

The demonstration of the upgraded Mi-17 helicopter, expected to lead to the signing of a deal early next year, took place in the potential customer's country.

"The Mi-17 upgrade success is based upon the capability and experience that ATE has created, both in itself and in the South African defence industry, when it upgraded a large fleet of Russian Mi-24 helicopters aimed at significantly enhancing its operational performance," says Duncker.

He states that the design philosophy for the NAH "is to use proven and operational weapons systems and to design an airframe around that, rather than following some existing design phisolophies, which focus predominantly on the airframe, leaving the weapons system development to the last".

It is envisaged that the platform features of the NAH will include a tandem layout; an all-composite airframe with integral infrared suppressors; and an engine, a gearbox and a drivetrain similar to those on the South African-made Rooivalk attack helicopter.

It will also feature a weapons system comprising a turret-mounted 20-mm dual-feed cannon with a range of up to 2 000 m; guided and unguided rockets; canister-protected, and laser beam-riding guided Ingwe missiles on stub-wing outboard stations, boasting a range of 500 m to 5 000 m. The missiles will be capable of penetrating 950 mm rolled homogeneous armour.

The weapons system will also boast chaff and flare countermeasures coupled to the mission electronic warfare system, including missile approach warning, radar warning and laser warning.

The NAH's avionics will include a three-screen glass cockpit for each crew station, a digital map with Doppler/global positioning system hybrid navigation, a communications and electronic warfare suite, an identification-of-friend-or-foe system and a voice/data recorder.

The sighting system will comprise a nose-mounted system, boasting three field-of-view forward-looking infrared and three field-of-view TVs; provision for laser range finding; autotracking, missile guidance and laser designation capabilities; a helmet-mounted sighting system for cannon and sight cueing; and binocular vision displays on the visors of both crew members. Aiming and flight information will be displayed in the field of view.

"The focus of the NAH will be to transfer technology and to create the capability for a new helicopter industry in the country of the prospective customer," says Duncker.

Meanwhile, ATE has announced the successful flight qualification of composite main rotor blades for the Mi-24 helicopter and the completion of the preliminary design and characterisation of composite blades for the Mi-17 helicopter, the development of which has started.

"Composite blades have an infinite operating life and an infinite shelf life, thus enabling operators to procure a single set of composite blades for the lifespan of the helicopter, whereas, previously, six sets of metal blades would have to be procured," says Duncker.

"Composite rotor blades could replace metal blades without any change or modification to the helicopter, its procedures and performance or the standard documentation."

In another development, ATE is to unveil a Pall vortex engine air particle separator system for the Mi-24 helicopter at the Africa Aerospace and Defence 2008 exhibition, to be held in Cape Town on September 17 to 21. The new system will provide protection to the engine from fine sand and dust particles, thereby doubling its operating life.

President Motlanthe stresses policy continuity, reappoints Manuel

By: Reuters
Published: 25 Sep 08 - 17:46

Kgalema Motlanthe took office on Thursday as South Africa's president and stressed he would keep to the policies of his predecessor Thabo Mbeki, who resigned in the worst political crisis since apartheid.

In a move to reassure investors rattled by the crisis, former trade union leader Motlanthe reappointed respected Finance Minister Trevor Manuel, whose resignation on Tuesday hit the rand currency and stocks.

Mines Minister Buyelwa Sonjica was also reappointed.

Motlanthe, deputy leader of the ruling African National Congress, made only one change in key economic portfolios, appointing Brigitte Mabandla to replace Mbeki loyalist Alec Erwin at the head of the public enterprise ministry responsible for troubled power utility Eskom.

Motlanthe was overwhelmingly elected earlier by parliament in a secret ballot and will serve as interim president until a general election next year when ANC leader Jacob Zuma is expected to become head of state.

The ANC withdrew its backing for Mbeki on Saturday after a judge suggested he had interfered in a graft case against Zuma, his arch rival, who toppled him as head of the party last December.

In his acceptance speech after being sworn in, Motlanthe also stressed continuity with the policies of Mbeki, who presided over the longest period of growth in South African history.

"We will remain true to the policies that have kept South Africa steady and that have ensured sustained growth," the new president said.

But he vowed to intensify efforts to increase growth and job creation and "ensure that the benefits of growth are equally shared by all our people."

ARMY OF POOR

Mbeki's failure to bring the fruits of black majority rule to the army of poor was a leading cause of his unpopularity with the leftist ANC backers of Zuma, his long term rival.

Almost one-third of South Africa's cabinet stepped down on Tuesday out of loyalty to Mbeki, highlighting the worst infighting in the party's history.

Motlanthe, a quiet spoken leftist intellectual and ally of Zuma, faces huge challenges including slowing economic growth and high inflation. Officials said on Thursday consumer inflation hit its highest level in August since before the end of apartheid, at 13,7 percent.

Reflecting the ANC's dominance of parliament, Motlanthe won 269 votes, compared to 50 for the candidate of the opposition Democratic Alliance.

The upheaval in the ANC, climax of a power struggle between Mbeki and Zuma, has raised concerns of instability in Africa's biggest economy and a possible split in the formerly monolithic ruling party.

Motlanthe, a former Anti-apartheid soldier, is widely respected by both radical leftists and business tycoons within the African National Congress.

He will try to heal the worst rifts in the history of the party because of the battle between Mbeki and Zuma, which has overshadowed pressing issues such as widespread poverty and crime and an AIDS epidemic ravaging millions.

Radical policy changes under Motlanthe in the short transitional period are unlikely but foreign investors eager for stability and a continuity of economic policy will be watching closely for clues on whether the ANC will change course.

The populist Zuma is trying to reassure foreign investors he would not stray from business-friendly economic policies but is under pressure from left-leaning union allies to alleviate poverty through more government spending.

Edited by: Reuters

Mangena to launch SA-developed electrical car in France

By: Chanel Pringle
Published: 26 Sep 08 - 17:15

South Africa's Minister of Science and Technology, Mosibudi Mangena, would next week unveil a locally-developed electric car at the Paris Motor Show in France, the Department of Science and Technology (DST) announced on Friday.

South African company Optimal Energy and South African automotive designer Keith Helfet designed the multipurpose vehicle, which was named Joule.

The DST had provided Optimal Energy with R50-million in capital from its Innovation Fund to develop the project. The Industrial Development Corporation was also a shareholder in the project.

The development of the project was announced in May this year, with the DST reporting that a passenger and utility vehicle were being designed.

The six-seater vehicle was expected to have a range of between 100 km and 400 km, with solar panels charging the car when parked in the sun.

The DST expected initial production, which would start in 2010, to comprise about 4 000 units a year.

guys i need some help. im heading to uk in december and need to buy pounds obviously but now the rand is sitting at over R16 to the pound, if anyone has any knowledge regarding this matter please advise wether to buy now and avoid future rises or wait to see what happens?

Iceland is the first victim of the current global crisis. And seems to be bankcrupt...

SA won't escape world recession
Oct 8 2008 1:59PM

Johannesburg - There is not a long-term solution to the global crisis other than a lot of pain, and if the world does go into a recession or depression, South Africa "won't escape", says chief economist from Econometrix, Dr Azar Jammine.

While Jammine expects a protracted period of sluggish economic growth, when looking at Wall Street's sudden drop of over 500 points last night, he says the possibility of a further crash in the short term cannot be ruled out and 2009 could turn out to be the worst year economically since the 1920s if that scenario does play out.

Jammine says while South Africa's economy will not do as badly as developed ones will, it won't escape and he sees potential slower growth of around 3.5% dipping to as low as 1% or 2% in 2009 in a depression scenario.

"SA GDP growth is correlated to world GDP growth," he notes. "All of us will suffer to some extent, but it will be a little better than in the developed world," he said.

"Forget politics, the driving force is going to be what happens internationally," says Jammine.

He pointed out that the rand had suddenly reversed to over nine to the dollar overnight as risk aversion continued and said: "It is a very worrisome time".

However, he pointed out that the rand's overnight fall was "predictable" as the relationship with the Dow of late has been 1:1.

"I have never seen anything like this in the 40 years I have been involved," he added.

He said current sustained volatility was "quite frightening". "It is different from what we are used to."

Jammine said while a bounce could have been expected after the bailout news, he was now more concerned about a further crash as long-term price-earnings ratios are only on their historic averages, rather than well below them. There was thus a possibility prices could drop 30% or 40% in the next few weeks before hitting a bottom.

Jammine says he is not sure which scenario is better: slow agony or a sudden hit.

rates unchanged and the rand under 9 to the usd, jse is also up. roll on summer.
for the first time since the rate hikes started tito had something good to say about the inflation outlook. reckon the zar strenthend on the back of the fed cutting rate. lets hope for a rate cut early in 2009.

^^ i take it back, what up with zar?

Seems it's a global thing. Now it's around R10, one rand weaker than two days ago :(

ja heavy days. been getting px increase emails from suppliers all day.. jeez.

"F*cking scared" is the phrase I'm looking for.
My first solo Moz vacay now cancelled,have to go stare into space with the whole family in Margate...

^^ :ohno: that is scary.

Iceland is the first victim of the current global crisis. And seems to be bankcrupt...

Q: You must have heard the joke by now. Whats the capital of Iceland?

A: $5

ANC Plans to Boost Industry Development
20 October 2008

Mathabo Le Roux

Johannesburg - THE African National Congress (ANC)-led government is going to upscale industrial development dramatically in a bid to reduce unemployment.

A plan, outlined yesterday after the weekend economic summit of the ANC and its alliance partners, the Congress of South African Trade Unions (Cosatu) and the South African Communist Party (SACP), takes its cue from the ambitious national industrial policy framework, released in August as the centrepiece of a major state intervention to kick-start industrial development in key areas of the economy.

Support from the treasury for the plan has been lukewarm.

But industrial policy took centre stage at the weekend as the alliance made it clear it wants to up the ante in addressing one of SA's most pressing challenges: its 23% unemployment rate. Indications are that the ANC may also look at realigning empowerment policies to prioritise job creation.

"The focus of industrial strategy must be job creation. In future (black economic empowerment) must also be aligned more scientifically with the need to create jobs and develop local industrialisation. It is all going to be about jobs, jobs, jobs," said Cosatu secretary-general Zwelinzima Vavi at a post-summit press briefing yesterday. The alliance sees a central role for state-led development of the economy.

SACP deputy general secretary Jeremy Cronin said the alliance envisaged stepping up resource allocation for industrial strategy drastically in a bid to boost manufacturing, exports and jobs.

" Our allocation for industrial policy has been fairly paltry. We really need to speed up very drastically its implementation," said Cronin. A 15-year review showed systemic problems in the economy related to it not being restructured.

Development finance bodies such as the Industrial Development Corporation and Development Bank of Southern Africa will play a key role in funding industrial development. The alliance wants to use public procurement and state-owned enterprises to boost manufacturing capacity.

The alliance also said a task group would be set up to assess the effectiveness of macroeconomic policies, including inflation targeting, and to gauge measures to ensure a more stable and competitive currency.

To ensure funding of the industrial development strategy , the alliance outlined sweeping changes to the cabinet, ostensibly a measure to rein in the treasury's dictates on budget allocation.

Relations between the treasury and the trade and industry department have been strained by the treasury's aversion to intervention and its reluctance to fund industrial development.

Cronin stressed, however, there was "convergence in the alliance and government about how priorities needed to be realigned".

He said Finance Minister Trevor Manuel and Reserve Bank governor Tito Mboweni had attended the weekend summit "with their ANC hats on".

AllAfrica (http://allafrica.com/stories/200810200048.html)

All 3 major SA cities made this list, which is great

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

New MasterCard Research Ranks 65 Cities in Emerging Markets Poised to Drive Long-Term Global Economic Growth


Last update: 6:00 p.m. EDT Oct. 22, 2008

PURCHASE, N.Y., Oct 22, 2008 /PRNewswire-FirstCall via COMTEX/ --

With global economic growth expected to be driven primarily by emerging economies at an unprecedented rate of 12 to 1 compared to rich-world economies (according to the International Monetary Fund), emerging markets are becoming increasingly important investment and business centers. Responding to this reality and providing guidance in today's economic environment is a new study from MasterCard Worldwide, the Worldwide Centers of Commerce(TM): Emerging Markets Index.

The Index provides valuable insights into the 65 leading cities driving growth within more than 30 emerging markets. Cities are generally considered to be leading indicators for national economies, making the study an important barometer of larger global economic trends and growth potential over time.

"Given the current economic climate, MasterCard is focused on providing valuable insights that assist our customers in identifying new market opportunities for the future. The Emerging Markets Index is key to that commitment," said Walt Macnee, President, Global Markets, MasterCard Worldwide. "By evaluating 65 emerging market cities and their increasingly important roles in global commerce, the Index offers companies a roadmap for where commerce is headed next."

The Index evaluates 65 cities on eight dimensions related to their business climate, political environment, economic growth, commercial connectivity, quality of life and other areas, and explores the compelling global and regional economic trends that distinguish these cities as future development hubs.

Some key findings from the study include:

-- China led the Emerging Markets Index ranking overall, with 15 of the top
30 cities. Shanghai and Beijing held the number one and two spots
respectively.
-- Budapest ranked third overall, helped by its heritage as one of the
first eastern European countries to initiate trading with the West
following the Cold War.
-- South Africa had more cities on the list than any nation outside of
Brazil, Russia, India and China (the BRIC nations), suggesting that
Africa may be entering an era of growth in the global market.
-- Latin American cities held two of the top ten spots, and five Brazilian
cities placed among the top 50.


"As the current financial environment shows, globalization is a part of today's economic reality -- capital, talent, technology and even intellectual property now move seamlessly across borders and nations," said Dr. Michael Goldberg, Program Director, MasterCard Worldwide Centers of Commerce. "Emerging market cities will play an increasingly important role in global commerce and may provide unique market opportunities for businesses in the face of changing economic times."

The Index, developed by a panel of nine independent experts in economics, sociology and urban studies, is part of the broader MasterCard Worldwide Centers of Commerce(TM) program -- a global initiative to examine the role of cities in performing critical functions that connect markets and commerce around the world.
The full report and ranking are available at www.mastercardworldwide.com/insights.
Key Findings

Asia Pacific, Middle East and Africa

Chinese Cities Dominate the Index. With 15 cities ranked in the top 30 and four in the top ten including #1 Shanghai, #2 Beijing, #6 Guangzhou and #10 Shenzhen, China outshone all other countries in the Index. Chinese cities placed among the top ten within the Index in measures relating to their commercial climate, economic growth and business connectivity, and held all top ten spots in the area related to education and IT connectivity. China's national economy played a key role in its city rankings, as has the visionary leadership of Shanghai, an important global commercial center.
Outsourcing Engine India Second Only to China. Led by Mumbai, the number one city in a critical dimension related to financial markets, eight Indian cities appeared in the Index, more than any country other than China. Scoring well in measures related to security and risk and connectivity, this showing reflects the leadership of cities like Chennai, a global center for automotive and film production.

South Africa a Gateway to a Continent.

With the most cities in the Index outside the BRIC nations (Brazil, Russia, India and China), South Africa's strong showing may reflect the ongoing opening of Africa to Western products, services and companies. It is clearly a place to watch carefully for new business opportunities.

Latin America and the Caribbean

Stable and Safe Santiago Leads the Region. With high scores in dimensions related to economic stability, the business climate and quality of urban life, Santiago places #5 overall and first among its regional peers.
Rich in Resources, Brazil Is a Leader in LAC. This fast-growing nation has five cities appearing in the Index, including Sao Paolo (#12 overall) which scored in the top ten in dimensions related to financial market volumes and business connectivity.
Santo Domingo the Only Caribbean Island City on the Index. At #51, the city proves itself an important locale for the Caribbean, as well as Central America and northern South America. It is a center worth keeping an eye on.

Europe

Commercial Heritage Helps Propel Budapest to #3 Spot. The number one city in the Index for dimensions covering quality of life and risk and security, Budapest also scores among the top ten for its economic and commercial environment and its business climate. A former world capital, Budapest was among the first Eastern European cities to trade with the West following the Cold War and is benefiting from its first mover initiatives.

Where East Meets West, Istanbul Is a City to Watch. With high rankings for its financial markets and quality of life, Istanbul also places among the top ten cities in commercial connectivity, befitting a large, growing nation with easy geographic access to many other growing markets.

Moscow, Russia's Most Connected City, Places Within Top 15 Cities. Among the top five cities in the Index in dimensions related to air passenger, cargo volume and other measures of connectivity, as well as financial market volumes, #14 Moscow leads the four Russian cities ranked in the Index.

Methodology

The MasterCard Worldwide Centers of Commerce(TM): Emerging Markets Index is compiled from research by a panel of nine independent economic, urban development and social-science experts from leading academic and research institutions around the world, led by Dr. Michael Goldberg, Program Director, MasterCard Worldwide Centers of Commerce Program.

To form the Index, the panel rigorously identified 65 cities around the world that met their initial stringent criteria. Cities were then rated on eight key dimensions as follows:
-- Economic and Commercial Environment
-- Economic Growth and Development
-- Business Environment
-- Financial Services Environment
-- Commercial Connectivity
-- Education and IT Connectivity
-- Quality of Urban Life
-- Risk and Security


The process entailed measuring a number of carefully weighted, relevant indicators and sub-indicators that aggregate available data relevant to each dimension. The panel evaluated a total of eight dimensions comprised of 65 indicators and 89 sub-indicators to derive an Index score for each city, a process that goes well beyond traditional measures used to gauge worldwide financial and business activity.
About the Worldwide Centers of Commerce: Emerging Markets Index Research Team
Leading the Worldwide Centers of Commerce program is Professor Michael Goldberg, Program Director. With more than 40 years of experience, Professor Goldberg has consulted for businesses and governments in Canada, the U.S. and Asia, lectured at 50 universities and research institutes in 16 countries and authored or co-authored nine books and more than 200 academic and professional articles. To assist him in this research, Dr. Yuwa Hedrick-Wong, Economic Advisor for MasterCard Worldwide, APMEA Region, initially assembled and chaired a panel of leading experts in economics, urban development and social-science from around the world, including the following:
-- Professor Fan Gang, Director, National Economic Research Institute,
Beijing
-- Mr. Manu Bhaskaran, Partner/Head, Economic Research, Centennial Group,
Singapore
-- Professor William Lever, Emeritus Professor of Urban Studies, University
of Glasgow
-- Professor Maurice D. Levi, Chair of Bank of Montreal Professor of
International Finance, University of British Columbia
-- Dr. Anthony Pellegrini, Partner/ Director of the Urban and
Infrastructure Policy and Finance Practice, Centennial Group,
Washington, D.C.
-- Professor Saskia Sassen, Helen and Robert Lynd Professor of Sociology,
Committee on Global Thought and Department of Sociology, Columbia
University
-- Professor Peter J. Taylor, Director, Globalization and World Cities
(GaWC) Research Network, Loughborough University, UK


2008 MasterCard Worldwide Emerging Market Index Ranking

Rank City Country

1 Shanghai China
2 Beijing China
3 Budapest Hungary
4 Kuala Lumpur Malaysia
5 Santiago Chile
6 Guangzhou China
7 Mexico City Mexico
8 Warsaw Poland
9 Bangkok Thailand
10 Shenzhen China
11 Johannesburg South Africa
12 Sao Paulo Brazil
13 Buenos Aires Argentina
14 Moscow Russia
15 Istanbul Turkey
16 Xiamen China
17 Chengdu China
18 Dalian China
19 Mumbai India
20 Tianjin China
20 Nanjing China
22 Hangzhou China
23 Wuhan China
24 Chongqing China
25 Qingdao China
26 Xian China
27 Harbin China
28 New Delhi India
28 Monterrey Mexico
30 Sofia Bulgaria
31 Montevideo Uruguay
32 Bucharest Romania
33 Cape Town South Africa
34 Lima Peru
35 Bogota Colombia
36 Rio de Janeiro Brazil
37 Durban South Africa
38 Bangalore India
39 Chennai India
40 Tunis Tunisia
41 St. Petersburg Russia
42 Brasilia Brazil
42 Jakarta Indonesia
44 Cairo Egypt
45 Manila Philippines
46 Hyderabad India
47 Recife Brazil
48 Kolkata India
49 Curitiba Brazil
50 Ankara Turkey
51 Santo Domingo Dominican Republic
52 Pune India
53 Casablanca Morocco
54 Coimbatore India
55 Quito Ecuador
56 Ho Chi Minh City Vietnam
57 Kiev Ukraine
58 Medellin Colombia
59 Yekaterinburg Russia
60 Beirut Lebanon
61 Caracas Venezuela
62 Novosibirsk Russia
63 Nairobi Kenya
64 Karachi Pakistan
65 Dakar Senegal


About MasterCard Worldwide

MasterCard Worldwide advances global commerce by providing a critical economic link among financial institutions, businesses, cardholders and merchants worldwide. As a franchisor, processor and advisor, MasterCard develops and markets payment solutions, processes over 18 billion transactions each year, and provides industry-leading analysis and consulting services to financial-institution customers and merchants. Through its family of brands, including MasterCard(R), Maestro(R) and Cirrus(R), MasterCard serves consumers and businesses in more than 210 countries and territories. For more information go to: www.mastercard.com.

Note: Information in this report is for informational purposes only. It is recommended that professional advice be obtained in connection with making any assessments regarding projected impacts on your business. No assurances are given that any of these projections, estimates or expectations will be achieved, or that the analysis provided is error-free. The information, including all forecasts, projections, or indications of financial opportunities are provided on an "as is" basis for use at your own risk. MasterCard will not be responsible for any action taken as a result of this report, or any inaccuracies, inconsistencies, formatting errors, or omissions in this report.
SOURCE MasterCard

http://www.imf.org/external/pubs/ft/weo/2008/02/index.htm

Copyright (C) 2008 PR Newswire. All rights reserved

http://www.imf.org/external/np/sec/pn/2008/pn08137.htm

On September 8, 2008 the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with South Africa.

Background

South Africa's economic performance has strengthened in the last several years, with real GDP growing by 5-5½ percent in 2005-07, inflation declining to mid-single digits until recently and employment growing steadily. Growth last year was driven by strong domestic demand, with private consumption and investment spending supported by robust consumer and business sentiment. Household consumption was also boosted by growing disposable income, rising employment, and wealth effects from rising asset prices until late in the year. Total employment grew by 3.4 percent in the year to September 2007 and the unemployment rate declined to 23 percent.

However, 2008 saw a slowdown in activity reflecting the cumulative impact of electricity power shortages, the global slowdown, and past monetary tightening. Real GDP growth slowed to 4.2 percent (year-on-year) in the first half of 2008, and subsequent high-frequency indicators point to further moderation.

Inflation pressures have intensified further. Twelve-month CPIX inflation has been rising since early 2007—reaching 13 percent in July 2008, well above the South African Reserve Bank's (SARB) 3-6 percent target range—mainly reflecting rising global food and fuel prices and, until recently, demand pressures.2 Inflation expectations for the year ahead have picked up markedly. In response to the deteriorating inflation outlook, the SARB has raised its policy interest rate by 300 basis points since June 2007, to 12 percent by June 2008, but decided to keep it on hold in August in light of falling commodity prices and some moderation in inflation expectations.

Credit to the private sector has begun to moderate but still remains resilient, expanding by 20.3 percent in the year ending in June 2008. Household debt rose slightly to a record level of 78¼ percent of disposable income by the first quarter of 2008. Pushed mainly by rising interest rates, household debt service has risen to about 11¼ percent of disposable income, but remains below historic highs.

Asset prices continued to rise rapidly in 2007 but has moderated significantly since then. Strong commodity prices drove the JSE all-share index up by 16 percent in 2007. In 2008 the index fell by 4 percent through July, reflecting weakness in financial and manufacturing share prices, which were only partially offset by the strong performance of resource equities. Residential property prices recently slowed considerably, growing by about 4 percent in the year ending in June 2008.

The current account deficit expanded sharply to 7¼ percent of GDP in 2007 and almost 9 percent in the first quarter of 2008, driven by strong public and private investment and rising international oil prices, before narrowing somewhat to 7¼ percent of GDP in the second quarter of 2008. The deficit was financed by a mixture of equity and debt-creating inflows, bringing external debt to 26½ percent of GDP by end-2007. Net portfolio flows were negative in the first quarter of 2008 and the current account deficit was covered by the proceeds from a large foreign direct investment (FDI) deal and an increase in nonresident bank deposits; net portfolio inflows turned positive again in the second quarter. Risk premia on South African debt in international markets rose steeply in the first quarter of 2008, reflecting turmoil in global financial markets, before moderating somewhat by mid-year.

The SARB has maintained a flexible exchange rate system, with a publicly-announced policy of purchasing foreign exchange on the market only to bolster its reserve position. Consistent with this policy, gross reserves grew to US$34.9 billion by June 2008—well over 200 percent of short-term external debt. After depreciating markedly in early 2008, the rand strengthened somewhat by end-July 2008. In real effective terms, the rand has depreciated by 10 percent in the 12 months ending April 2008.

The fiscal balance of the national government turned into a surplus of 0.9 percent of GDP in FY2007/08, bringing government debt down to about 28 percent of GDP. The surplus, the second in a row, reflected a large increase in tax revenue, owing to strong economic activity over most of the period and continued collection efforts. Total public debt, including obligations of public enterprises and local governments, fell to about 35 percent of GDP.

Executive Board Assessment

Executive Directors welcomed the significant economic strides made by South Africa over the past several years, reflected in high economic growth, low inflation, and rising employment. These achievements have been based on sound macroeconomic policies and a transparent policy framework. South Africa's economic fundamentals remain strong, the external debt is low, and the financial system is resilient.

Recent developments, however, have heightened economic vulnerabilities and made more challenging the achievement of the authorities' medium-term growth strategy. In particular, global food and fuel price shocks have boosted inflation and the external current account deficit, while economic growth has slowed in the context of still-high levels of unemployment and inequality. On the domestic side, an elevated household debt and debt service burden poses further risks to growth and possibly to pockets of the financial system. The deterioration of the economic outlook has heightened the risk of a slowdown of capital inflows. Directors accordingly underlined the importance of continuing to address the constraints to economic growth and job creation, while taking steps to preserve macroeconomic stability and strengthen economic resilience. This will require redoubled efforts to raise South Africa's national saving rate, improve infrastructure, and implement further structural reforms.

Directors welcomed the authorities' pursuit of a prudent fiscal policy, and their intention to maintain a broadly neutral fiscal stance in 2008 while strengthening the social safety net in response to the increase in food prices. Directors acknowledged South Africa's pressing infrastructure and social spending needs, and noted the authorities' plan to raise public investment significantly. Given the importance of sustaining investor confidence and the limited scope for raising private saving, most Directors called for an increase in public saving so as to bring the structural public sector borrowing requirement to zero over the next few years. This should be achieved mainly by containing current expenditure and increasing spending efficiency. Several Directors suggested that the authorities explore options for addressing infrastructure and social needs that would avoid weakening fiscal policy—for example, by relying more widely on public-private partnerships established within an appropriate transparent regulatory regime.

Directors considered that the inflation targeting framework has served South Africa well. They supported the tightening of monetary policy so far in 2008 to contain inflation expectations and the second-round effects of the food and fuel price shocks. They noted the central bank's current pause in further tightening, but considered that the authorities should stand ready to raise interest rates further if supply shocks resume or domestic demand pressures do not dampen as expected. Some Directors considered that conditions warrant the resumption of monetary tightening. Directors also considered the effective lengthening of the policy horizon for bringing inflation back within target range to be appropriate, given the increase in inflationary pressures. They commended the high quality of the central bank's written communications and public discussions, and underscored the continued importance of a clear communication strategy for containing inflation expectations.

Directors considered that South Africa's floating exchange rate has served as a useful buffer against external shocks, limiting foreign exchange exposure in balance sheets and discouraging speculative inflows. While acknowledging the considerable uncertainty surrounding estimates of the equilibrium value of the currency, Directors took note of the staff's tentative assessment that the currency may be moderately overvalued. Directors supported the authorities' policy of gradually building up international reserves.

Directors welcomed the Financial Sector Assessment Program (FSAP) update finding that South Africa's financial system is sound, well capitalized, and well regulated. They stressed the importance of the authorities' continued proactive engagement with banks to ensure that capital and liquidity buffers are adequate—especially in the current context of a less benign environment, including high exposure to the household sector. Directors called for prompt implementation of the FSAP update recommendations—in particular, those relating to deeper forward-looking financial stability analysis based on bank-level data, and to an improved regulatory framework based on consolidation of the supervision of financial conglomerates and strengthened insurance and pension supervision.

Directors stressed the importance of structural reforms to boost productivity and employment growth. Possible fiscal reforms to be explored include deficit-neutral modifications to revenue and expenditure policies aimed at strengthening incentives to invest and work. Directors also encouraged the authorities to persevere with steps to open the economy to greater international competition, strengthen product and labor market competition, and improve education outcomes.

SA Credit Act a worldwide hit
Nov 03 2008

The National Credit Act has become a hit with policy-makers worldwide, as the credit crisis tilts the world economy towards the worst recession since the 1930s.

Brown expects Saudi fiscal help
Nov 02 2008 16:28

Britain's Gordon Brown is confident that Saudi Arabia will contribute to the IMF, after he promised business leaders in the Gulf that they would have a say in any future new world economic order.

Johannesburg - South Africa's National Credit Act (NCA) has become a hit with policy-makers around the globe as the international credit crisis tilts the world economy towards the worst recession since the 1930s.

A number of African and European countries are studying the Act with the aim of hardening their own credit legislation and reining in reckless lending.

The ongoing credit turmoil, the architect of which is the world's financial powerhouse, the US, has laid bare to the global community how greedy and heedless lenders can ruin the world economy and its financial markets.

Around the world as much as $435bn has been lost by major banks and financial institutions that had invested heavily in the US's $1.3-trillion sub prime mortgages sector.

Sub prime lenders granted mortgage loans to risky, over-extended home buyers but when interest rates started to shoot up the sub prime market collapsed, choking off credit and sending famous Wall Street banks like Bear Stearns and Lehman Brothers to the graveyard.

Peter Setou, a senior manager at the National Credit Regulator (NCR), said this week in the light of the global credit crunch many African and European nations had been soliciting advice from South Africa to help them with strengthening their credit policies.

"There has been a lot of interest from mainly African and European countries wanting to study the Act," said Setou. "For instance, we are currently assisting the Namibians to develop legislation similar to what we have."

He said the NCR had received delegations from Botswana, China, Mongolia and the European Coalition for Responsible Credit (ECRC) wanting to learn about the Act.

On November 12 Setou will travel to London to address a two-day conference hosted by the ECRC, a powerful coalition of non-profit organisations whose main objective is to press western European governments to adopt legislation that encourages responsible credit granting. The NCR's global reach took it to Brazil this week, where its chief executive, Gabriel Davel, spoke about the NCA at the third Global Credit Reporting Conference.

"I think other countries are interested in the Act because of what is happening internationally and how irresponsible lending contributed to it. We get a lot of invitations to address conferences all over the world," Setou said.

Experts agree that the sub prime crisis, the root cause of which was reckless lending, was worsened by weak regulation of the financial system in the US, the world's richest economy. But in South Africa the NCR is keeping a watchful eye on the local credit industry, which has an estimated value of more than R1.1 trillion.

After the introduction of the Act in June last year car dealers and estate agents complained that the legislation was depressing sales as banks were approving fewer loans.

Part of the reason for the slowdown in credit extension was that the Act had changed the credit approval process. In the past, consumers would qualify for home loans if their monthly repayments did not exceed 30% of their monthly salaries.

However, the new legislation made it mandatory for banks to take into account the consumer's total disposable income before approving a mortgage. The banks had to ensure that the borrowers could afford the loan by closely inspecting expenses against the entire disposable income.

Debt counselling

The Act also introduced the concept of debt counselling for over extended borrowers to mitigate an increase in defaults. Experts say it is SA's shield against credit woes, such as the one plaguing the US.


"The South African banking system has effectively been insulated from the global financial crisis mainly as a result of the prevailing exchange control regulations," said First National Bank spokesperson Xolisa Vapi.

"Having said that, the Act has had its benefits for us in that it has improved the way we look at a customer before granting credit.

"Whereas in the past we would have looked at creditworthiness, there is now more emphasis on the customer's cash flow to accurately determine the level of affordability to repay a loan," he added.

When he delivered the mini-budget statement last week Finance Minister Trevor Manuel praised the country's robustness in regulating the financial markets.

Watchdogs such as the Registrar of Banks, Errol Kruger, and the Financial Services Board - which regulates insurers, pension funds, and asset managers - are vital cogs in South Africa's regulatory system.

"The financial stability assessment conducted by the IMF and World Bank during April and May this year concluded that the financial system in South Africa is fundamentally sound and noted that our financial sector regulatory framework is sophisticated, modern and effective," said Manuel.

He said: "Banks have become increasingly inventive in channelling foreign savings to American consumers and firms. For example, the market for credit swaps through which bad debt has been passed onto pension funds and other investors grew from $100bn in 2000 to $62 trillion last year.

"This is just one of the financial innovations of the past decade that have contributed to the current destructive implosion of global financial markets."

Excellent another saffer world first type invention

A good read for those of us who have life, education etc. handed to us on a platter.


The life and times of Trevor Manuel

Hard times for Manuels and teenager Trevor


By Pippa Green

This is an extract from Choice, not Fate: The Life and Times of Trevor Manuel, by Pippa Green, published by Penguin. It will be on sale from November 21 at a recommended retail price of R320.



MONEY in the Manuel household trickled to a thin stream after Abraham Manuel's death. Fortunately, the Manuel parents had paid the last instalment on their house shortly before Abraham's death, according to Renecia, the youngest daughter; still there was little cash in hand at the end of the month. Whereas before, Pam had worked weekends at the Sea Point supermarket for money for her duffle coat, now she had to work for money for bus fare to school.

Trevor, who turned 14 in 1970, soon joined her. He worked first at Punkies, then at Pick n Pay, today an international operation, then a pioneer in the supermarket business in Cape Town. "Fridays, Saturdays, end of the month, where possible the fifteenth of the month when the army got paid. I worked at Pick n Pay for 24 cents an hour through my schooldays. I don't remember it ever changing."

The money he earned paid his bus fare from Kensington to Salt River; it also allowed him to party, a leisure activity that he has never shown himself, then or since, averse to.

But it was a tough year - his "hardest", he said many years later. "I'm adolescent, I'm 14, I don't have a father figure. Woodstock (in the United States, not Cape Town) is happening, there's stuff around you in the township. I think that was a particularly difficult year for me."

His weekend work meant he had to give up his sports on Saturday, as well as the cub troop he attended. It was a loss for the teenager because not only did he enjoy the games, but he liked the sociability of both.

He struggled with his school work too. After an auspicious start in primary school - he not only passed the arm-to-ear test but wrote the best essay in his class in Standard 1, according to Aziz Bardien, a contemporary - his work had steadily slipped in high school. Combined with the trauma of his father's death was a bout of mumps at the end of his Standard 7 (Grade 9) year. Unable to write his end-of-year exams, he was nonetheless pushed through to the next grade.

His mother wanted him to go to Harold Cressy in Standard 6 (the year before his father died), but he didn't pass the fairly stringent entrance tests. She was insistent for a number of reasons. Wesley only went as far as Standard 8, and Cressy had an excellent reputation, particularly in science and maths.

It was a time when the effects of apartheid were being acutely felt in Cape Town, particularly in the schools. In 1963, the government passed the Coloured Persons Education Act, segregating schools completely. The Group Areas Act had had a devastating effect on schools, scattering teachers and pupils around the Peninsula and resulting in shortages of teachers in the new areas where they were needed most. By the end of the 1970s, expenditure on coloured pupils by the government was about one fifth of what it was on whites (and on African scholars about one twelfth).

Ironically, though, high school enrolment increased for all race groups during the 1960s and 70s, even for the most disadvantaged. For coloureds (the vast majority of whom lived in the Western Cape), high school enrolment grew from 25 000 in 1960 to 57 520 in 1970.

More education did not equate to either better education or better jobs. The Theron Commission into the circumstances of coloured people reported that, in the 1970s, only 3.6% of economically active coloureds filled higher level management, professional or technical positions. One third lived below the subsistence level, and the government's education policy effectively trapped most people "in the ranks of the labouring poor".

But education, however poor or unequal, was still the best chance out of a dead-end street and, surprisingly, there were still a handful of coloured schools in Cape Town that offered excellent education.

One was Harold Cressy. Situated in Roeland Street, on the upper slopes of the city close to where District Six had been, it was in the top ten of the "feeder schools" for the prestigious (and largely whites only) University of Cape Town, a cut above even some of the elite white schools at the time. Under certain restricted circumstances, coloured and African students could attend the university.

The school is named after the first coloured man to have graduated from the University of Cape Town (then known as the South African College) in 1909. Later, he became one of the founders of what became a central organisation in coloured political life in the Cape, the Teachers' League of South Africa (TLSA).

Cressy, described by his contemporaries as a brilliant scholar, was himself a victim of discrimination when he was barred from taking up a teaching bursary because the South African Rhodes and Victoria Colleges refused him entry on the grounds of his colour. He went on to become the first principal of Livingstone High School in the southern suburb of Claremont, also seen as a centre of educational excellence since its inception in 1910.

Cressy, like many others of the coloured middle class of his generation, saw education as the salvation of the community and fought a continual battle against increasing discrimination.

"Let us live for our children" was a key slogan of the Teachers' League. In fact, the league produced unusually good teachers in an era when apartheid education tried to undermine every facet of excellence in black schools.

Many of the prescribed textbooks gave teachers of the league wonderful teaching material, if only in their repudiation. Nothing was neutral. Even English grammar textbooks contained such sentences as "All the Bantu who had been drinking beer began to fight one another", as American author William Finnegan discovered.

Finnegan, who taught for a year at Grassy Park High, a more poorly equipped school than Cressy, and who recorded his experiences in an evocative book, Crossing the Line, found many of the standard textbooks to be full of such "racist mischief".

But Cressy was different, in large part because of the political tradition of the teachers who taught there. One was Helen Kies, widow of the TLSA leader Ben Kies, who was banned for life from teaching in 1956 because of the leadership role he played in opposing apartheid education.

Mrs Kies taught Latin and English at Cressy and revelled in being able to repudiate a syllabus that was replete in racism. "Our main lesson was: We are One Human Race; there are no Superior and no Inferior Races," she told author Alan Weider.

She remembered Manuel at school. But she did not have much to say about him, partly because he did not do Latin, partly because he was not a star pupil at the time, and probably mostly because of the politics he had adopted in later years.

I visited her at her home high up in Bo-Kaap on Signal Hill with a commanding view of the city and mountain. At 80, she was still intellectually sharp, and warm and hospitable to me in spite of her reputation for being somewhat icy. In conversation her formidable knowledge of education, both in its practice and its history, was clear, and in her analysis of the present she showed the superior intellectual skills that made her such a powerful teacher.

She must indeed have been a tower at Cressy, as many of her former students testify. But she did not let me interview her. Instead she provided me with reams of literature about the history of the Unity Movement (of which the Teachers' League was a vital part) and the Teachers' League.

Her hospitality belied the tales of her intolerance that persist among older coloured ANC activists in the Western Cape, remnants of a long enmity. But those tales are there. Reg September said she turned her back on him at a function soon after he had returned from exile; and she refused to attend a presidential function to bestow a posthumous award on her husband.

Nonetheless, the teachers at Harold Cressy, her among them, were legendary for the quality, no-nonsense, politically provocative education they provided. After his failed first try, Trevor managed to get into Cressy in 1971, following his sister Pam. He was now in Standard 9 (Grade 11), the penultimate year before graduation.

He still worked weekends at the supermarket, partied Saturday nights, and on Sundays would "chill" with friends. His school work floundered. As a result, he failed maths and physics that year and was kept down.

"I was quite distraught about it," he recalled.

"He cried," said Pam.

"The teachers told my mom that he had a lot of potential but he was just not interested," said his eldest sister Beryl. "And then they failed him, deliberately failed him Standard 9. And ... that pulled him right ... he had to sit up and take note."

Somehow his pride withstood the failure. After all, he'd started school a year young, he reckoned. So, in 1972 he started Standard 9 a second time.

# Green is a highly respected journalist and writer who began her career in 1982 reporting on the trade union and anti-apartheid resistance movement for the Argus. Born in Cape Town in 1958, Green was educated at the University of Cape Town and at Columbia University in New York, and in 2006 held the position of Ferris Professor of Journalism at Princeton in New Jersey. Her work has been published widely across South Africa and the US. She has served as the deputy editor of the Sunday Independent and Pretoria News, and as Head of Radio News at the SABC.

Published on the web by Cape Times on October 29, 2008.

SA Credit Act a worldwide hit
Nov 03 2008



its as if Manuel was getting ready for the storm he knew was coming.

Strategic opportunity

By Razina Munshi





With 2 800 km of coastline, and 14 terminals at six commercial ports, SA's deep-sea shipping sector should be thriving. About 95% of the country's exports, by value, are transported by sea.


It's a R140bn industry, but it's dominated by foreign players. Just 5 Mt or 1,5% of SA's import/export market of 350 Mt is handled by SA-based shipping companies.


The last remaining ship flying SA's flag is so old that it is about to be decommissioned, says SA Maritime Safety Authority (Samsa) CE Tsietsi Mokhele. SA companies used to own more than 40 ships. State-owned Safmarine sold its fleet of 18 to private players in 1993.


Mokhele says SA should benefit from a slice of the seaborne cargo pie. He believes in promoting the country as a maritime shipping centre, hosting the head offices of companies as well as providing skills and support for ship building and repair.


The sector needs a national maritime cluster to bring government, the private sector and other interests together, says Mokhele. In addition, the time is ripe for SA players to own vessels, he says.


At a shipping industry workshop hosted by the Industrial Development Corp last week, participants likened the maritime sector to SA's motor industry, whose development programme was launched 13 years ago.


SA's location means that any ship that cannot pass through the Suez canal takes the long route around Africa. This includes most large vessels like oil tankers.


An incentive to encourage ship owners to operate from SA is national treasury's tonnage tax. Common in maritime nations, such a tax helps companies operate competitively from their home country.


Government's draft white paper on maritime transport policy is another initiative aimed at growing SA's maritime presence. It moots protectionism in the form of regional and domestic transport restrictions, building a ships' register, and establishing coastal corridors.


Another development is the transport sector's black economic empowerment charter launched last week. It recommends major change, including that 25% of the 350 Mt industry should move into local hands.


This would translate into 300 SA-owned ships, R35bn in revenue and at least 12 000 jobs, says Nkanyiso Buthelezi, director of Southern Chartering, a company made up of Dubai-based MUR Shipping and SA empowerment consortium Ndonsa Investments. "We need to leverage off our strengths."


Cargo owners, says Buthelezi, could benefit from SA's mineral resources if local mining houses used SA ships.


India is building six new power stations and will require more than 60 Mt of coal annually. If SA could supply coal through the India-Brazil-SA partnership, and locally owned vessels transported it, the benefits to the economy would be substantial, says Buthelezi. "We want to own vessels," says Buthelezi. He argues that without ownership, SA will not be a big player on the scene.


But Grindrod, the leading SA shipping company, believes SA has to be cautious about ship ownership in the present global financial climate. Executive director Dave Rennie points out that a large vessel costs about R1,5bn, making it difficult for new players to be owners.


Rennie adds that initiatives like the tonnage tax may align SA's tax environment with other ship-owning nations and could be an incentive for SA ship ownership. But SA would have to do more to create an environment that will attract foreign owners and operators from established jurisdictions.

http://free.financialmail.co.za/08/1107/features/58-7ftshipping.jpg


Fred Jacobs of shipping line Maersk believes SA should focus on developing the skills within the industry before venturing into ownership. The risks in the business means skills and support should be in place first.


The shortage of skills has been a worry, and government hopes to address it with the transport charter.


But Samsa's Mokhele says training of seafarers has been difficult precisely because vessels are not SA-owned. He says he has been involved in cadet programmes that have stalled because foreign owners do not prioritise training of locals. Lance Manala, owner of shipping consulting company Amistad and one of the pioneers of empowerment in the sector, agrees that if SA does not own vessels, training will not be a priority.


Costs may be a barrier, but one can work around that. New players can start small in partnership with investors and owning just a portion of their ships, says Manala.


Mokhele agrees that high costs are not a complete barrier to entry. The global maritime industry has grown, and the financial crisis is not a big enough reason to discourage ownership, he says.


"When external factors change, SA should position itself as a maritime nation," says Mokhele.


Mokhele says the British merchant fleet, despite operating in an environment of high labour and other costs, has grown from 172 to 820 in eight years. This happened after the UK made a strategic effort to boost its maritime industry.


Europe's short sea-shipping policy, which prevents internationally owned ships from carrying cargo from one European nation to another, is an example of a protectionist policy designed to help local industry. He believes SA should explore this.


"It is going to take guts, money, and vision to transform the sector," says Mokhele. "But why should we leave it untapped?"

Economic growth may fall to 1,9% next year, BER forecasts

Engineering News

By: Esmarie Swanepoel

Published: 20 Nov 08 - 17:19

South Africa’s economic growth was expected to slow to 1,9% in 2009, which would be its slowest pace in ten years, the Bureau for Economic Research (BER) said on Thursday.

The BER lowered its forecast for 2009’s economic growth from 3%, on the “dramatic deterioration” in global growth prospects and the plunge in prices of South Africa’s key exports, such as platinum.

BER economist Hugo Pienaar stated that while the bureau acknowledged that it was already at the bottom-end of that latest consensus forecast for the local economy, its reading of the global environment and the potential negative spill-over to South Africa indicated that growth could be weaker in 2009.

The BER said its expected 2008’s growth to be 3,3% from the 5%-plus environment. By 2010, South Africa’s growth was expected to recover to 3,6%, should the world economy start to recover and domestic interest rates decline.

“A return to growth in excess of 5% is not expected anytime soon,”

The BER said that the risk of a South African recession had increased, and that it could not be ruled out. However, it stated that baseline forecasts did not foresee two quarters of falling gross domestic product (GDP).

“However, the retail sector has probably already slipped into recession during the third quarter, and leading indicators seem to suggest that the manufacturing sector is also at risk.”

The future economic impact of the bankruptcy calls from global financial institutions was likely to be severe, with the world’s leading economies projected to face the toughest environment since the early 1980s.

The consumer price index excluding interest rates on mortgage bonds (CPIX) inflation moderated to 13% year-on-year in September after reaching record highs in August, Pienaar said. The plunge in world oil prices had improved the inflation outlook, while the substantially weaker rand had replaced oil as the key inflation risk factor.

“As with the GDP forecast, the 2009 inflation projection is complicated by a number of factors. First and foremost is the uncertainty surrounding the downward bias expected from the rewighting/basing of the inflationary data from January 2009.”

Pienaar added that another technical change was that the CPI would replace the CPIX as the inflation target measure, and the expected disinflationary impact from lower global price pressures and the weak domestic economy could mitigate against the inflationary pass-through from the weaker rand, which complicated the forecast.

The BER expects CPI inflation to average around 8% during 2009, and stated that inflation was only expected to fall below the South African Reserve Bank’s 6% target in the first quarter of 2010.

The assumption was that the rand would continue to trade above R10 to the dollar through the third quarter of 2009, before strengthening towards R9,50 in the final quarter of the year as commodity prices started to recover.

“The view of a sustained weaker rand is informed by the BER’s concern that the financing of the current account deficit will remain challenging in the current global environment of heightened risk aversion. From the start of September to November 14, foreign investors sold a massive R45-billion worth of stock on the JSE, which provides some explanation for the rand’s sharp fall.”

The combination of a moderation in price pressures, a significant domestic growth slowdown, and global monetary policy easing, should ensure that the next interest rate move was down, Pienaar stated.

“However, BER is of the view that concerns about the financing of the current account deficit may prevent the central bank from cutting rates anytime soon. Our base line view is that the first cut is only likely in the second half of 2009, and that we are likely to see cuts worth 150 basis points in 2009, followed by a further 100 basis points during 2010.”

The two scenarios that could alter the baseline forecast included, if domestic GDP growth significantly underperformed, or if continued foreign capital outflow continued to push the rand even weaker.

Edited by: Mariaan Webb

Johannesburg - The Gauteng Provincial Government (GPG) on Friday launched a R7bn private equity fund aimed at developing new infrastructure projects in the province.


Dubbed the Gauteng Fund, it is in partnership with the private sector with a focus on job creation.

"When fully leveraged, the fund will contribute more than R35bn to infrastructure development in the province," said Mandla Nkomfe, Gauteng's Finance and Development MEC.

The GPG has injected R500m as seed capital to establish the fund. The target balance of R6.5bn will be raised from local and international investors in the private sector.

"The capital-raising process has to date seen favourable interest from major local institutions and global markets including the Middle East, Europe and the US," said Nkomfe.

The Fund has a three-pronged structure. The capital raised will be housed in a Bewind Trust under the control of a board of trustees. The board will comprise two representatives of the GPG, one of whom will serve as chairperson, with the balance of members being appointed by private sector investors.

Projects with a value of over R300m submitted to the fund by departments and agencies of the GPG, as well as from Gauteng Metropolitan Cities and municipalities, will be considered and assessed by the Gauteng Fund project office.

The project office will ensure that the projects reviewed support the interests of government and integrate the principles of commercial, technical and economic viability.

Once a recommendation has been made by the project office, the fund manager will complete a thorough due diligence and refer the final investment decision to the investment committee appointed by the board of trustees.

While the project office and GPG input at board level will facilitate adherence to all public sector governance requirements, commercial concerns will be addressed by the private sector fund manager.

Once a project is approved, the fund will involve the relevant departments, agencies and/or municipalities in negotiation of final terms and support or enhancement aspects.

- I-Net Bridge

petrol price will be cut to under R8/L +- 18% drop. good news for inflation.

R1bn Coega contract goes to Texan firm

HERALD CORRESPONDENT

A R1-BILLION contract to pave the way for the biggest industrial development in Eastern Cape history was awarded yesterday.

PetroSA president Sipho Mkhize said the engineering and design contract for the planned $11-billion (R113-billion at current exchange rates) crude oil refinery at Coega had been awarded to Texas-based company KBR.

The mega-refinery – named Project Mthombo and planned to produce 400000 barrels a day – is expected to be the largest in Africa when it comes into production in 2014.

“The refinery will play a major role in securing South Africa‘s future fuel supplies,” said Mkhize, who added the appointment of a world-class firm such as KBR was “a giant milestone”.

“National demand for refined fuels already exceeds South Africa‘s refining capacity. Diesel consumption is forecast to grow at six per cent and petrol at 2% per annum between 2009 and 2020,” Mkhize said in Cape Town.

According to PetroSA, South Africa will have to import 10 billion litres of fuel a year (200000 barrels per day or about 20% of the national requirement) by 2015 if there is no significant investment in local refining capacity.

“Importing this much refined fuel will have a negative impact on the country‘s foreign exchange reserves and makes national supply very vulnerable to external factors.”

Mkhize said KBR had been appointed because of the quality and expertise of its management, its proven mega-refinery expertise in the petroleum industry and its total commitment to this fast-tracked project.

The feasibility phase of the project will be concluded by September next year and final board approval for the investment will be sought in late 2010, after which construction will begin.

It is expected that the refinery will create about 25000 direct and indirect jobs.

The company said last month that half of Coega‘s output would be exported to sub-Saharan Africa.

The refinery will have its own gas-fired power station, a boon as South Africa battles power shortages

KBR downstream operations president John Quinn said the contract meant in essence doing enough design to allow a very accurate estimate of finals costs.

A condition of the deal was that KBR establish a 25% black equity shareholder. The company, which has an office in Johannesburg, would also use local suppliers and contracts wherever it could. – I-Net Bridge, Sapa, Reuters

SA to decide on scrap metal tax by February

By: Reuters
09 Dec 08

South Africa expects to make a decision on a scrap metal export tax early next year, but may postpone its introduction as prices have fallen sharply in the global economic slowdown, a government official said.

The government has been discussing the measure to discourage exports of scrap metal and ease input costs for downstream manufacturing to boost value-added exports.

But the plan has faced wide criticism from the recycling industry, which says the tax would benefit the bigger players.

Nimrod Zalk, head of industrial policy at the Department of Trade and Industry, said the government was still evaluating its options.

"At the moment we are looking at whether any kind of mechanism to control the export of scrap is appropriate and if it is, what could be the most appropriate form that it might take," Zalk told Reuters.

South Africa had invested heavily in the collection of scrap, he said, adding it would not be economically efficient to allow scrap to be exported without any further beneficiation, or treatment.

"I can't give any specific date, but we expect a decision early next year, let's say by January or February," he said.

Zalk said the ministry would take into account the drop in demand and prices on the back of a worsening demand outlook.

"When the talks started, we were in the middle of a commodities boom. Now prices have come down and obviously that will factor into our decision," he said, adding the tax might only kick in at a particular point in the commodities cycle.

Prices for scrap are calculated by using the metals prices on the London Metal Exchange (LME), depending on the quality of the material.

DEMAND

Copper fell to 3-1/2-year lows last week as demand slumped, and aluminium hit its lowest level in more than five years, echoing trends of other industrial metals. Metals soared on Monday, but traders have questioned the sustainability of any rally.

"We might look at a price-based system or at a quantitive restriction, or a combination of both," Zalk said.

But industry representatives have complained the tax might subsidise bigger players like ArcelorMittal SA, and it could put smaller scrap companies and individual traders out of business.

ArcelorMittal uses about 1.8 million tonnes of scrap metal annually, of which some three-quarters are sourced internally and the remaining 450,000 tonnes are procured in South Africa. Some 3 million tonnes of scrap are estimated to be recycled in the local market each year.

"We have never objected to supporting local industry first, but we do object to supporting them to the detriment of our own industry," said Bernard Maguire, spokesman at the Metal Recyclers Association of South Africa.

Maguire said the government was still too vague in what direction it was going with the measure and whom it would benefit, adding that the timing was unfortunate.

"In the light of what is going on in the world at the moment, this is the wrong time for the government to be talking about something like this," he said.

"It's disruptive to the industry in terms of keeping the confidence of our buyers overseas."

Edited by: Reuters

South Africa: Quarterly Growth Hits Ten Year Low

Michael Appel 9 December 2008
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Pretoria — South Africa's economy weakened considerably in the third quarter of 2008, recording the lowest quarterly growth rate in ten years, reported the South African Reserve Bank (SARB), Tuesday.

Real Gross Domestic Product (GDP) grew by 1.0 percent in the third quarter after slowing by a revised 3.5 percent in the second quarter, the SARB reported.


According to the central bank's Quarterly Bulletin this was due to a significant contraction in the country's mining sector which has been directly affected by a drop in demand for commodities in developed markets, many who are in the midst of a recession.

Adding to South Africa's economic woes, the SARB reported that the country's manufacturing sector also declined significantly in the third quarter of 2008.

"The tight domestic economic environment in the third quarter of 2008 was reflected in stagnant real disposable income in the household sector and a contraction - the first since the fourth quarter of 1998 - in the sector's real final consumption expenditure.

"Purchases of consumer durables declined considerably, while expenditure on nondurable goods such as food and fuel also receded, consistent with the high prices of these items," the SARB said. The prevailing high interest rates did manage to slow demand for credit as a percentage of household debt in the third quarter after peaking in the first quarter of this year.

The environment on international markets and the depreciation of the local currency presented a new risk to inflation, said the bank.

"The effective exchange rate of the Rand depreciated significantly during September 2008 and subsequently fluctuated around lower levels.

"Broadly, similar behaviour was displayed by the currencies of a number of other commodity-producing countries with comparatively large current-account deficits," the bank reported.

The bank's Monetary Policy Committee (MPC), who is holding its two-day meeting over Wednesday and Thursday this week, is expected to bring some relief to consumers with a 50 basis point cut in the repo rate.

The MPC kept the rate unchanged at 12 percent in August and October 2008.

This revised CPI basket, used for inflation targeting purposes, would see inflation being revised downwards by 1 - 2 percent next year.

The change in the CPI basket will see the measure of inflation no longer include mortgage interest costs, but will include owners equivalent rent.
http://allafrica.com/stories/200812090377.html

Final launch date set for SA satellite

By: Keith Campbell
10 Dec 08

South Africa’s Sumbandila microsatellite is scheduled for launch on March 25 next year, which will be a Wednesday.

The launch will be on a Soyuz launch vehicle of the Russian Roscosmos space agency, from the renowned Russian-operated Baikonur Cosmodrome in Kazakhstan.

SumbandilaSat will form a secondary payload for the rocket, the primary being a Russian Meteor M weather satellite.

SumbandilaSat was originally meant to have been launched last year, from a Russian Navy submarine, on a converted Shtil submarine-launched ballistic missile. That arrangement fell through, for reasons that have never been officially divulged (but see Engineering News February 8, 2008).

The South African microsatelllite has been designed, developed and assembled by SunSpace, a specialist microsatellite technology company spun-off by the University of Stellenbosch, to exploit the expertise developed in the design, assembly, and operation of the university’s own private-initiative satellite, SunSat, which, in 1999, became the first South African satellite to reach orbit.

SunSat had a mass of 64 kg and carried a fairly small multispectral imager, operating in three bands (red, blue, and green) with a resolution of 15 m (that is, one pixel equating to 15 m x 15 m on the ground) at an altitude of 600 km – the first of its kind on a small satellite in any country.

Sumbandila is a low Earth orbit observation microsatellite and its main payload is a 6,5 m multispectral imager – that is, the imager has a resolution of 6,5 m x 6,5 m at an altitude of 500 km. This imager was also designed, developed, and made by SunSpace.

Sumbandila means “lead the way” in the Venda language.

Edited by: Creamer Media Reporter

South Africa is in 'recession': Moody's

December 16 2008, 6:08:00

Sherwin Bryce-Pease

Ratings Agency Moody's Investor Services says South Africa is technically in a recession and can expect a challenging fourth quarter in terms of growth.

The agency has included South Africa on its high vigilance countries list, although they have downplayed the risk of an investment rating downgrade.

Kristin Lindow of Moody's says South Africa’s growth is currently in decline and will likely continue for two further quarters.

The latest macro-economic scenarios have various emerging countries listed in a high Vigilance Category, but in South Africa's case, this is a cautionary move.

The Moody's report concludes that the past year has clearly made a convincing case for thinking the unthinkable. The report advises countries including South Africa to consider vulnerabilities that could result in outcomes more severe than those currently contemplated.

Isn't a recession two consecutive quarters of negtive growth? last time I checked we still had positive growth....minimal, but still positive

Isn't a recession two consecutive quarters of negtive growth? last time I checked we still had positive growth....minimal, but still positive

The recession will come next year officially although I think that if the economy grows by less than 2% or the population growth rate it should be considered a recession as per capita incomes decline rather than the arbitrary measures which are based on Western countries' norms rather than developing countries like SA where the challenges are greater. Private sector economists predict GDP will grow by only 1% next year.

I also believe that to be officially in recession, two consecutive quarters of negative growth was the marker.

SA steel output plunges 40%
Dec 18 2008 15:41

Johannesburg - South African crude steel production plunged 40.4% from 795,000 tons in November 2007 to an estimated 474 000 tons in November 2008, the World Steel Association (WSA) reported on Thursday.

Releasing November crude steel production data, WSA said South African crude steel production for the 11 months to end November 2008 declined 3.9% to 8.08 million tons from 8.41 million tons for the same period the year before.

African output fell 35% year-on-year in November to 1.03 million tons and 4.3% in the 11 months to end November to 16.19 million tons.

Of the African countries reporting to WSA, Zimbabwe recorded the steepest decline in production in November with its output slipping to zero from 1 000 tons in November last year.

Morocco recorded the second steepest decline in production in November with that country's output falling 87.3% year-on-year while Algerian crude steel production dropped 46.6% and Egyptian production slumping 25.9%.

African crude steel production falls reflect the trend seen in the global crude steel industry where most producers are slashing output to cut costs and prepare for further decreases in demand.

WSA said world crude steel production for the 66 countries reporting to the association was 89 million tons in November - 19% lower than the same month last year.

Total world crude steel production was 1 224.6 million tons in the first 11 months of 2008, a 0.9% increase over the same period in 2007.
WSA's data shows crude steel production falling across the board with very few exceptions.

Highest increases in November production were reported by Croatia, which showed a significant 93.3% jump; Cuba with a 26.6% climb in output and Canada, where production increased 15.2%.

The largest decline in production was, however, reported by the Commonwealth of Independent States where output tumbled 43.1%, and after Africa with its 35% fall in output, North America lost a significant 30.4% of its production in November.

European Union countries reported a 24.8% fall in the amount of crude steel manufactured while Asia recorded an 11.4% drop.

China's crude steel production for the month was 35.2 million tons, a decrease of 12.4% on November 2007.
In the first 11 months of 2008, China produced 463 million tons of crude steel, an increase of 2.6% compared to the same period in 2007.

- I-Net Bridge

Offshore pros queue for SA jobs
January 16, 2009

By Lucky Biyase

Johannesburg - Recruitment agencies have reported a dramatic increase in the number of international professionals and South Africans living abroad who are seeking employment in South Africa after the waves of retrenchments that have hit the US and Europe.

Penny Chaskelson, the managing director of The Personnel Concept, said the agency had seen an increase of between 20 percent and 25 percent in international professionals inquiring about employment opportunities in South Africa.

"There has been a dramatic increase in responses from all over the world, and that is first and foremost a result of the global financial crunch," she said. "However, this has also been exacerbated by the fact that some professionals were already happy to move to any location for the right job."

Georgina Barrick, the managing director of Renwick Talent, said the group had seen a jump in inquiries about employment opportunities in South Africa since September.

Some were from South Africans who had been working in financial services outside the country, mostly in the investment and banking sectors.

"We are receiving about five applications a week and about two-thirds of these are South Africans," she said. Approaches had come from London and other European capitals, but there had been sudden interest from Egypt, with four inquiries from that country last week.


Martin Westcott, the chief executive of Production Engineers Corporate Services, said the trend of international professionals seeking jobs in the country was logical because the South African economy was still showing some growth.

He said the trend had come at a time when South Africa needed to recruit more skilled professionals to reduce inefficiencies across the spectrum.

"This is as a result of skills shortages. Some companies were even failing to realise their employment equity targets, due to a lack of appropriately skilled personnel.

"The arrival of these personnel in the country could provide us with the opportunity of skills transfer," he said.

In apparent validation of this trend, the Umsobomvu Youth Fund said that it had taken advantage of the situation by recruiting 20 skilled professionals who would be partnered with 40 young South Africans to develop their skills.

Malose Kekana, the fund's chief executive, said 15 skilled professionals had been identified. They would be partnered with local youths "with the purpose of grooming them for us. We have put the effects of the financial crisis to good use."

Kekana said the professionals would not have great cost implications for the fund, as Umsobomvu would pay only for their flights, accommodation and meals.

^^ interesting... Look likely SA economy will do well this year.

The world cup prep and all the infrastructure projects are booming on at just the right time for South Africa in terms of the world economic crisis.
I predict us to level out in the early part of this year, but still with pockets of growth, and then to accelerate all the way to 2012 at least.
Coming back to SA if you are overseas is now a smart move - not just an emotional one!

Establishment of SA space agency a step closer

JOHANNESBURG, SOUTH AFRICA Jan 15 2009 14:41

President Kgalema Motlanthe on Thursday signed a Bill that will see the country set up its own space agency, the Department of Science and Technology said.

Spokesperson Nhlanhla Nyide said an Act could see the country pull together all space-related activities under one banner later this year.

"The agency will oversee development of space missions, develop technology platforms and acquire, assimilate and disseminate space satellite data for any organ of state," he said.

The agency was approved by Cabinet in December 2008 to stimulate the country's capabilities among leading nations in the innovative utilisation of space science and technology.

"The project is expected to boost the economy and create more jobs. The first step towards its establishment will be to appointment a board of 10 to 15 members, a CEO who is an ex-officio member, and a chairperson appointed by the minister of science and technology."

Some of the projects it will coordinate include the Square Kilometre Array bid, the Southern African Large Telescope, and the launch of South Africa's second indigenous satellite, Sumbandilasat. -- Sapa

http://www.mg.co.za/article/2009-01-15-establishment-of-sa-space-agency-a-step-closer

Bank clampdown hammers commercial property developers
Realestateweb reporter

16 January 2009

Top property man says onerous new terms by bank managers means fewer developments, could be good for existing landlords

It's not just home-buyers who are struggling to obtain finance for properties: big investors say onerous terms by banks mean new developments will not go ahead. That in turn suggests continued low vacancies in office space.

The credit crunch has resulted in banks withdrawing much funding for speculative developments, Marc Wainer - executive director of Madison Property Fund Managers - said on the SAfm Market Update with Moneyweb this week.

Wainer was talking about a proposed merger between Madison (JSE: MDN) and other publicly listed property companies Redefine (JSE: RDF) and ApexHi (JSE: APA). Such a move would produce a much bigger property company worth nearly R20bn, making it attractive to index-tracking funds.

Growthpoint (JSE: GRT), South Africa's largest public property company, recently made it to the ranks of the country's biggest 40 companies.

"If we follow the Growthpoint kind of example and we do get into some of the indices, then I think there is substantial upside in the share in terms of rerating," Wainer told Moneyweb host Alec Hogg on Thursday.

Aside from improving the rating for shareholders, Wainer's team believes that becoming bigger is essential "now that we are going into stormy waters and choppy seas".

If the economy remains the way it is, "there have to be casualties, so we can say we are defensive and all those kind of things," said Wainer.

He pointed out that "across the board all funds are going to have tenants who are going insolvent or out of business" in a tougher year.

Radio listeners also heard that with retailers under pressure and higher electricity costs and rates, it is difficult for big landlord to "get real growth out of rentals".

"In the office sector, I think we are still going to see growth because the credit crunch has resulted in the banks withdrawing a lot of funding from speculative developments," said Wainer.

Banks "now want to see 25% or 30% equity, 60% pre-let, and those are not going to happen".

In terms of existing office space, this is "very positive", said Wainer.

http://www.realestateweb.co.za/realestateweb/view/realestateweb/en/page198?oid=30681&sn=Detail

This article certainly puts things in perspective for those who think we have things bad in SA. Although the writer gets a few things wrong (no potholes on SA roads, 90% criminal apprehension rate etc), he does make interesting points on things that South Africans don't usually appreciate and take for granted.

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

Are We Really The Giant Of Africa?

Sam Nda-Isaiah
January 11th, 2009

I have just returned from a vacation in South Africa that saw me traversing Johannesburg, Cape Town and the magical Sun City. South Africa is a First World country built by the whites but which has been maintained, improved and constantly renewed by the black ANC-controlled government since 1994. They were lucky to have had Nelson Mandela as the first post-apartheid black president and not Robert Mugabe or Olusegun Obasanjo. Mandela who once declared that "courageous people do not fear forgiving" laid a rock-solid nationalist foundation based on the principles of true democracy, predicated on free and fair elections, rule of law and justice. He insisted on spending only one term as a sacrifice for the growth of democracy and statecraft in the country he loves so much. That is why when the man (or to him, the boy) he groomed to succeed him got too close to Obasanjo and in the process picked up a few bad manners and wanted to remain in power and reckoning beyond his brief, he was humbled at his party's convention and subsequently thrown out as the nation's president. And everything was done according to the rule of law and due process.

There are still crimes and hooliganism in the country. In fact, South Africa is renowned for its violent crimes, but the difference with Nigeria is that you could see the government spending sleepless nights trying to solve the problem. These days, there are installed cameras and CCTVs everywhere, especially in the crime-infested areas, to spot criminals. And, in more than 90% of cases, those who perpetrate crimes are apprehended. Robbers and assassins are taken into custody almost on a daily basis. In Nigeria, a serving minister of justice was assassinated seven years ago but, as I write, the authorities are not even looking for the criminals. Bola Ige is only one of numerous examples. There are also the cases of Sa'adatu Rimi, Marshal Harry, Aminosoari Dikibo and a host of others. Maybe, another difference between the reality of crime in Nigeria and South Africa is that the people that are supposed to be searching for and apprehending criminals are the same people that are perpetrating the crimes.

Another thing. There is no large water source in Johannesburg, so the city sources its water supply from a neighbouring country. In spite of that, all the taps gush with water with the kind of pressure that we in Nigeria can only imagine. There are no potholes at all on any of their roads, and, everywhere you go, there are ongoing new projects. Less than two years ago, the government decided to build a new rail line. By June this year, it will be completed and you see the efforts to complete it everywhere you go. They are constructing larger and more sophisticated stadia – bigger than the disposal one Obasanjo built in Abuja, but at even less the cost. They are constructing the stadia in Johannesburg, Cape Town and Durban, and you see work going on day and night. There are no abandoned projects in South Africa and contractors are not owed.

And, as we all know, a black majority government has been in place for 15 years. Since then, the economy has grown exponentially so much so that the Rand, the local currency, has not only maintained its convertibility, it has even become stronger. Their priority in education is covetable. Less than two weeks ago, the results of their secondary school certificate exams were released and the entire country has been engrossed with the progress or otherwise that their leaders of tomorrow are making. Newspapers and TV stations are discussing the results on a daily basis. They are currently busy assessing the performance of their children in critical subjects like Mathematics and the sciences. As a Nigerian onlooker, I was both impressed and depressed. Impressed at the purposefulness of a fellow African country, and depressed that my country has not even enlisted in the global race for the future.

A few weeks ago, South Africa's minister of health was ill and had to seek medical attention, but she dared not attend her regular private hospital much less travel to Germany or Saudi Arabia for treatment. In Nigeria, the president travels out on a regular basis to seek medical attention in hospitals in foreign countries without the slightest courtesy of even informing Nigerians. Meanwhile, all the public hospitals in Nigeria have now become places people only go to die. And why not? For almost one year last year, the nation had no minister of health.

In South Africa, every day you read the newspapers you see how the government is frantically responding to the global financial crisis. Nigeria is doing nothing because those in power are living under the self-delusion that Nigeria is "not affected by the crisis". Meanwhile, the Nigerian Stock Exchange (NSE) has all but collapsed.

But all that does not even begin to explain why I am sad at the moment. As our aircraft made to land at the Murtala Mohammed International Airport, Lagos, at the weekend, the entire city was without power supply. And as we drove to our hotel to spend the night before leaving for Abuja the following day, only the few houses that had generators had power supply. The whole of Lagos was in pitch darkness. But that's only the beginning of the story.

When I called my friend who had also just returned from his own vacation from, of all places, Liberia to tell him my ordeal, he was even angrier than I was. Throughout the one week he spent in Monrovia, the Liberian capital, he said, there was no power outage, even though the country had just emerged from a devastating internecine war. He said on his way back, they flew across a few African countries including Ghana, and because it was at night, they saw the glow of light bulbs in all the countries they flew across until they got to Nigeria. As they landed in Lagos, the entire city, Nigeria's commercial capital, was without electricity.

Nigeria is probably the only country in the world that is still in pitch darkness and getting worse. And this is after Obasanjo had spent $16 billion in eight years on the sector. And, as if that was not bad enough for me, another friend who had read my column two weeks ago – where I said, "Nigeria is regressing and sinking so fast that many of us may soon be spending vacation in backwater countries like Niger Republic" – called me. He told me that I was not even current enough. He and his family had just returned from a vacation in Niger Republic where they had peace and a hell of a good time. And he added, "There was no power outage throughout the period we were there."

That also reminded me of Col. Dangiwa Umar's brilliant letter to former President Obasanjo a few years ago. He told Obasanjo in the letter that he travelled by land to Niger Republic via Sokoto. He knew he had left Nigeria when the road suddenly became smooth without a hint of potholes. That, of course, was after Obasanjo had spent N350 billion "constructing roads".

The Longman Dictionary of Contemporary English defines delusions of grandeur as "the belief that you are much more important than you really are". No, Nigeria is not the giant of Africa, unless we are suffering from a classical case of delusions of grandeur. But we have what it takes to become one in the shortest possible time. We are a relatively well-educated, sophisticated and confident people. We are indisputably the intellectual hub of Africa. But we have allowed crooks and rogues to take over our commonweal for far too long. And it is not the fault of those rogue leaders. It is our collective fault. They would not be in power, if it were not with our consent.

http://leadershipnigeria.com/news/124/ARTICLE/5217/2009-01-11.html

Johannesburg - Worsening domestic expenditure coupled with a contraction in exports point to the weakest GDP growth in over a decade, say RMB's economists in a research note.

They say that along with falling inflation, this makes a case for further interest rate relief.

"However, because the cutting cycle will probably not be that deep, and the global economy will take time to mend, the strength of the next upswing should be a lot less than that of 2004-2007."

Overall, on a quarter-on-quarter annualised basis, they expect export volumes to shrink this year, improving only modestly thereafter.

New RMB forecasts put CPI inflation back within the target band by May 2009, before the base effect from the recent sharp drop in petrol prices sees it temporarily rising again to above 6.0% in the first quarter of 2010.

The economists expect economic growth to moderate from a recent peak of 5.8% year-on-year (y/y) in the fourth quarter of 2006 to a low point of zero in the second quarter of 2009, before re-accelerating to levels of around 4.0% in the second half of 2010.

"Our new forecasts imply that real GDP growth slackens from 5.1% in 2007 to 3.2% in 2008 (unchanged from before) and 0.7% this year (1.8%). For next year we anticipate a number of 3.3%," says RMB.

The RMB economists, however, table five conditions for growth to recover from the second half of 2009.

These are that the rand remains relatively weak, growth in developed countries turns positive again, export commodity prices bottom, CPI continues to moderate and domestic interest rates fall further.

Well at least we aren't in recession lol.

Well at least we aren't in recession lol.

Not yet.

It's time to become self-sufficient and invest in our own produce. Boosting industry is the key imo.

SA scores third in consumer optimism

2009/01/23

By ROBERT LAING


SOUTH African consumers were the world’s third most optimistic, the latest biannual survey by credit and debit card association MasterCard found.

SA would have come second if pessimistic Capetonians had not dragged down the national average. Durban consumers were found to be the most optimistic, scoring 89.6 index points, followed by Johannesburg with 83.3points. A gloomy 57.3 from Cape Town dragged the national average down to 78.7, placing SA behind Kuwait and Vietnam in the global ranking.

SA’s rise in MasterCard’s consumer confidence index for the first half of this year comes despite a five-point drop from the same period last year.

Economist Mike Schüssler, who heads the South African portion of the global poll, said local consumer confidence has not fallen as sharply as in the rest of the world.

MasterCard surveys people with a bank account who are not necessarily employed, and Schüssler warned this might have distorted the results.

The number of South Africans with bank accounts has rocketed due to government paying welfare recipients electronically.

Welfare recipients are confident of getting a regular income, unlike working people worried about their jobs in a depressed global economy.

SA’s unsustainably high number of welfare recipients may be why the country appears so optimistic, Schüssler said. SA had five million taxpayers supporting 13 million welfare recipients last year. Government’s policy of raising the child support age from 15 to 18, while lowering the male retirement age from 65 to 60, will see the number of welfare recipients rise sharply to over 16 million.

The number of taxpayers is only likely to grow slowly to six million over the next two years. “With 31 percent of our population on social support now, South Africa is already the world’s biggest welfare state and this is likely to rise to 37 percent.”

The welfare system will make SA a magnet for Africa’s unemployed, Schüssler warned. “Apparently, a fake ID costs R700 – making it the surest investment for a regular income right now,” he joked.

“Having so many welfare recipients may win votes in the short term, but in the long term government has to turn welfare recipients into taxpayers.”

MasterCard surveys people’s expectations for the coming six months, scoring in six sub-sections: employment, economy, regular income, stock market, and quality of life.

Cape Town’s low score was due to a very gloomy view of the stock market, unlike Durbanites, who expect a quick rebound. Schüssler pointed out many big asset managers are based in Cape Town, so this city’s opinion may be more educated.

“My impression is that people simply haven’t taken notice yet of South Africa’s weakening economic position.”

http://www.dispatch.co.za/article.aspx?id=288198

Dear me... 5 against 13, and expected to rise? :no:

Sars: revenue collection an uphill battle

January 27 2009 at 06:02PM

Revenue collection for 2008/9 has been "challenging" and turbulent economic markets have not helped, the SA Revenue Service said on Tuesday.

"In the last budget Minister [Trevor] Manuel set us a target of R642,3-billion for 2008/9 in revenue collections and it's been challenging," said Sars spokesperson Adrian Lackay.

The figure of R642,3-billion consisted of personal as well as corporate income tax, he said.

On the submission of tax returns, Lackay said many taxpayers were still expected to use the e-filing facility before the cut-off date of February 5.

"We expect e-filing to grow before February 5," Lackay said. - Sapa

http://www.iol.co.za/index.php?set_id=1&click_id=13&art_id=nw20090127170404665C907690

Very interesting piece

This article certainly puts things in perspective for those who think we have things bad in SA. Although the writer gets a few things wrong (no potholes on SA roads, 90% criminal apprehension rate etc), he does make interesting points on things that South Africans don't usually appreciate and take for granted.

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

Are We Really The Giant Of Africa?

Sam Nda-Isaiah
January 11th, 2009

I have just returned from a vacation in South Africa that saw me traversing Johannesburg, Cape Town and the magical Sun City. South Africa is a First World country built by the whites but which has been maintained, improved and constantly renewed by the black ANC-controlled government since 1994. They were lucky to have had Nelson Mandela as the first post-apartheid black president and not Robert Mugabe or Olusegun Obasanjo. Mandela who once declared that "courageous people do not fear forgiving" laid a rock-solid nationalist foundation based on the principles of true democracy, predicated on free and fair elections, rule of law and justice. He insisted on spending only one term as a sacrifice for the growth of democracy and statecraft in the country he loves so much. That is why when the man (or to him, the boy) he groomed to succeed him got too close to Obasanjo and in the process picked up a few bad manners and wanted to remain in power and reckoning beyond his brief, he was humbled at his party's convention and subsequently thrown out as the nation's president. And everything was done according to the rule of law and due process.

There are still crimes and hooliganism in the country. In fact, South Africa is renowned for its violent crimes, but the difference with Nigeria is that you could see the government spending sleepless nights trying to solve the problem. These days, there are installed cameras and CCTVs everywhere, especially in the crime-infested areas, to spot criminals. And, in more than 90% of cases, those who perpetrate crimes are apprehended. Robbers and assassins are taken into custody almost on a daily basis. In Nigeria, a serving minister of justice was assassinated seven years ago but, as I write, the authorities are not even looking for the criminals. Bola Ige is only one of numerous examples. There are also the cases of Sa'adatu Rimi, Marshal Harry, Aminosoari Dikibo and a host of others. Maybe, another difference between the reality of crime in Nigeria and South Africa is that the people that are supposed to be searching for and apprehending criminals are the same people that are perpetrating the crimes.

Another thing. There is no large water source in Johannesburg, so the city sources its water supply from a neighbouring country. In spite of that, all the taps gush with water with the kind of pressure that we in Nigeria can only imagine. There are no potholes at all on any of their roads, and, everywhere you go, there are ongoing new projects. Less than two years ago, the government decided to build a new rail line. By June this year, it will be completed and you see the efforts to complete it everywhere you go. They are constructing larger and more sophisticated stadia – bigger than the disposal one Obasanjo built in Abuja, but at even less the cost. They are constructing the stadia in Johannesburg, Cape Town and Durban, and you see work going on day and night. There are no abandoned projects in South Africa and contractors are not owed.

And, as we all know, a black majority government has been in place for 15 years. Since then, the economy has grown exponentially so much so that the Rand, the local currency, has not only maintained its convertibility, it has even become stronger. Their priority in education is covetable. Less than two weeks ago, the results of their secondary school certificate exams were released and the entire country has been engrossed with the progress or otherwise that their leaders of tomorrow are making. Newspapers and TV stations are discussing the results on a daily basis. They are currently busy assessing the performance of their children in critical subjects like Mathematics and the sciences. As a Nigerian onlooker, I was both impressed and depressed. Impressed at the purposefulness of a fellow African country, and depressed that my country has not even enlisted in the global race for the future.

A few weeks ago, South Africa's minister of health was ill and had to seek medical attention, but she dared not attend her regular private hospital much less travel to Germany or Saudi Arabia for treatment. In Nigeria, the president travels out on a regular basis to seek medical attention in hospitals in foreign countries without the slightest courtesy of even informing Nigerians. Meanwhile, all the public hospitals in Nigeria have now become places people only go to die. And why not? For almost one year last year, the nation had no minister of health.

In South Africa, every day you read the newspapers you see how the government is frantically responding to the global financial crisis. Nigeria is doing nothing because those in power are living under the self-delusion that Nigeria is "not affected by the crisis". Meanwhile, the Nigerian Stock Exchange (NSE) has all but collapsed.

But all that does not even begin to explain why I am sad at the moment. As our aircraft made to land at the Murtala Mohammed International Airport, Lagos, at the weekend, the entire city was without power supply. And as we drove to our hotel to spend the night before leaving for Abuja the following day, only the few houses that had generators had power supply. The whole of Lagos was in pitch darkness. But that's only the beginning of the story.

When I called my friend who had also just returned from his own vacation from, of all places, Liberia to tell him my ordeal, he was even angrier than I was. Throughout the one week he spent in Monrovia, the Liberian capital, he said, there was no power outage, even though the country had just emerged from a devastating internecine war. He said on his way back, they flew across a few African countries including Ghana, and because it was at night, they saw the glow of light bulbs in all the countries they flew across until they got to Nigeria. As they landed in Lagos, the entire city, Nigeria's commercial capital, was without electricity.

Nigeria is probably the only country in the world that is still in pitch darkness and getting worse. And this is after Obasanjo had spent $16 billion in eight years on the sector. And, as if that was not bad enough for me, another friend who had read my column two weeks ago – where I said, "Nigeria is regressing and sinking so fast that many of us may soon be spending vacation in backwater countries like Niger Republic" – called me. He told me that I was not even current enough. He and his family had just returned from a vacation in Niger Republic where they had peace and a hell of a good time. And he added, "There was no power outage throughout the period we were there."

That also reminded me of Col. Dangiwa Umar's brilliant letter to former President Obasanjo a few years ago. He told Obasanjo in the letter that he travelled by land to Niger Republic via Sokoto. He knew he had left Nigeria when the road suddenly became smooth without a hint of potholes. That, of course, was after Obasanjo had spent N350 billion "constructing roads".

The Longman Dictionary of Contemporary English defines delusions of grandeur as "the belief that you are much more important than you really are". No, Nigeria is not the giant of Africa, unless we are suffering from a classical case of delusions of grandeur. But we have what it takes to become one in the shortest possible time. We are a relatively well-educated, sophisticated and confident people. We are indisputably the intellectual hub of Africa. But we have allowed crooks and rogues to take over our commonweal for far too long. And it is not the fault of those rogue leaders. It is our collective fault. They would not be in power, if it were not with our consent.

http://leadershipnigeria.com/news/124/ARTICLE/5217/2009-01-11.html

South Africans coming home
January 25, 2009 Edition 1

Fred Kockott

HUNDREDS of South Africans living abroad might soon be returning home as a "tidal wave of global job shedding" gathers momentum.

Recruitment agencies such as The Personnel Concept and Renwick Talent are already reporting a dramatic increase in the number of international professionals and South Africans living abroad seeking employment in South Africa.

These agents, and Homecoming Revolution, a non-profit organisation that encourages South Africans living abroad to return home, now reckon that a new year prediction by analyst Clem Sunter that South Africa will experience a major reversal in the flow of skills, is coming true.

"Suddenly local is lekker in South Africa," wrote Sunter in a recent newspaper column, Ten things to watch in 2009.

South Africa has long suffered a serious flight of human capital, even before 1994, but in his 2009 forecast, Sunter reckoned this brain drain could be reversed "in the event of a prolonged worldwide recession".

"Our economy is unlikely to suffer as much as, say, the UK, America and Canada," said Sunter. "We are the America of Africa in that we represent a little less than 5% of the continent's population and produce 30% of the continent's GDP."

This week, a recession was officially declared in the UK, and Reuters reports that Australia, which is a major importer of skills, has announced there is to be a review of the country's migrant intake, making it less open than it was in the past.

To date, the demand for skilled workers in the UK, US, Canada, New Zealand and Australia has led to active recruitment by those countries in South Africa.

But there is now pressure on governments to shut the doors on foreign work seekers in these countries as the global recession kicks in, and companies embark on what Reuters has described "a firing frenzy" and "tidal wave of global job shedding".

Amid this, Georgina Barrick, managing director of Renwick Talent, said recruiting agencies in South Africa were experiencing an increase of between 20% and 25% in international professionals inquiring about employment opportunities in South Africa.

"We are receiving about five applications a week and about two thirds of these are South Africans. I've just received three CVs in the last three hours," said Barrick.

"There are always opportunities for appropriate skills in South Africa. We are an emerging economy, rich in commodities and well placed to be able to meet global demand, and when power changes in Zimbabwe, which it will, there will be an inflow of capital, with South Africa as the gateway to assist Zimbabwe," said Barrick.

Jacqui Young, marketing manager at The Personal Concept, said amid the surge in inquiries about jobs in South Africa, there had been "a slowdown in the number of South Africans looking for opportunities overseas".

"The instability and uncertainty of the international markets is certainly making a lot of South Africans think carefully about emigrating," said Young.

Marthine Schaffer, managing director of Homecoming Revolution, said whereas past "homecomings" had been largely due to people discovering that the "grass was not greener on the other side", many South Africans made redundant amid the recession abroad would have little "little choice but to come back home".

"The story last year was all about people leaving; 2009 will be about people returning," said Schaffer.

http://www.sundaytribune.co.za/index.php?fArticleId=4809162

Sonae industry announced Tuesday that it is considering closing the plant in George, South Africa, its subsidiary Sonae Novobord, which currently employs 137 workers.

"The start of the new line of cluster particles on White River, combined with growth in the construction sector lower than expected, resulted in excess capacity in relation to market demand," justified in release.

According to the company, this "requires to implement a restructuring of that company in the business and to consider the closing of its production units, located in the George, which has an annual production capacity of 60 thousand cubic meters of cluster of particles.

D-day today for rates cut, lets hope we get a 100basis points drop and sentiment in top financial cirles is we will get another 300 points off by DEC

100 it was, even thought Tito wanted 200...interesting start... not so good for me as i not a borrower

Establishment of SA space agency a step closer

JOHANNESBURG, SOUTH AFRICA Jan 15 2009 14:41

President Kgalema Motlanthe on Thursday signed a Bill that will see the country set up its own space agency, the Department of Science and Technology said.

Spokesperson Nhlanhla Nyide said an Act could see the country pull together all space-related activities under one banner later this year.

"The agency will oversee development of space missions, develop technology platforms and acquire, assimilate and disseminate space satellite data for any organ of state," he said.

The agency was approved by Cabinet in December 2008 to stimulate the country's capabilities among leading nations in the innovative utilisation of space science and technology.

"The project is expected to boost the economy and create more jobs. The first step towards its establishment will be to appointment a board of 10 to 15 members, a CEO who is an ex-officio member, and a chairperson appointed by the minister of science and technology."

Some of the projects it will coordinate include the Square Kilometre Array bid, the Southern African Large Telescope, and the launch of South Africa's second indigenous satellite, Sumbandilasat. -- Sapa

http://www.mg.co.za/article/2009-01-15-establishment-of-sa-space-agency-a-step-closer

Wow, SA is worth a big respect! :okay:

Are there any plans to collaborate with ESA (European Space Agency)?

Wow, SA is worth a big respect! :okay:

Are there any plans to collaborate with ESA (European Space Agency)?

Hopefully in the future. If SA wins the bid for the Square Kilometre Array (the biggest telescope in the world), it would be a major coup. At this point, the 2 finalists are SA and Australia. If we get it, we'll no doubt be collaborating with everyone. Or, more correctly, everyone will want to collaborate with us. :)

We have a number of advantages over Australia so hopefully we'll land the bid. At $1 billion, it will be a major investment in SA.

I know, that the final decision on the site will be made between 2011 and 2012. Do you know what are the chances of SA and what factors determines the winner?

I hope that the winner will be SA cause you need this more than Australia does. Of course, there will be a lot of collaboration between the winner and Europe - 1/3 of the funding comes from there.

I'm not an astrophysicist, but I know one of the major considerations is low electromagnetic interference, light pollution, geological stability . Oz and SA are great for that. SA is a lot closer to the European astrophysics community and it's also a multi-national effort with Namibia and Botswana - and so there's some benefit to the economies of these countries. Not sure if that's a factor though.

I believe the location in SA is also much higher in altitude (important as less earthy air to see through), and much closer to support towns, roads etc.
Being in the same time zone and geographically closer to Europe as well, I think it is a no brainer - but we are certainly in with a great chance.

Let's hope for the best! :)

SA's bid has several strenghts.

Re: topography - As radio astronomers need to observe at higher frequencies in the mm-wavebands, absorption due to water vapour in the atmosphere is a problem. The Oz site, at approx 450 m, is sometimes prone to mist. The SA site in the Karoo is a lot drier and at over 1000 m in altitude, has no mist problem. As some mm and sub-mm observatories are optimal at high altitudes, the Karoo site is superior in this respect.

Time zone: the time zone issue is a major advantage as if Oz gets the bid, European (and American) scientists would have to work according to Oz time zones, which would equate to horrible sleep patterns.

No competing development: the Oz project may run into a major obstacle. A major road is being built in the proximity of the proposed site. With major roads comes cars and cell phones. This would be a disaster for the telescope as it requires *absolute* radio silence (it's a radio telescope). SA has already passed legislation that would ban the use of any polluting telecommunications device within proximity of the telescope, thus ensuring a future radio quiet zone. It also has less light pollution and is far enough away but close enough too, to major infrastructure. There is also no conflicting / competing economic infrastructure (thankfully mooted plans for a golf course in the region were killed!).

Cost: Building the SKA in SA would be waaay cheaper than doing so in Oz. Aside from the Oz site being remote, Oz is just far away from everything, adding to the cost. Electricity is also cheaper in SA vs Oz (although recent Eskom tarriff increases reduces this advantage).

Infrastructure: SA has available and existing infrastructure to host the telescope (broadband connections, fibreoptic network etc is being rolled out).

SA has also proposed satellite sites in neighbouring countries (all of which have low radio frequency pollution), and as far as away as Mauritius, adding to the collection of data.

SA to spend billions on infrastructure
Michael Appel

11 February 2009

Government spending of R787-billion on public infrastructure over the next three years will push South Africa's budget deficit to 3.8 percent in 2009, Finance Minister Trevor Manuel announced on Wednesday.

Delivering his 2009/10 Budget speech in Parliament in Cape Town, Manuel said that decreased demand for South African commodities and lower outputs, coupled with decreased domestic growth, meant the government had to borrow more funds in order to finance planned public infrastructure projects.

"Although the budget deficit will rise to 3.8 percent of gross domestic product [GDP] next year, debt service costs will remain moderate over the next three years, at about 2.5 percent of GDP," Manuel said.

"This is possible because we had the courage to make the right choices over the past decade."

Unpopular choices pay off
The government's prudent spending policy in the past meant it could now spend on things such as transport, health and education where other governments were not able to.

In 1996, South Africa's public debt was 48 percent of GDP and rising, and the National Treasury came up with a macroeconomic strategy which confronted the problem boldly and decisively.

"Reducing the budget deficit was neither easy nor popular … but it was the right thing to do, and the outcome is that year by year the burden of debt service costs has declined and resources have been released to spend on education, health care, housing and infrastructure.

"This also means that today we are able to respond to the economic downturn boldly and decisively."

The funds South Africa is borrowing are not being used to fund failed banks, as is taking place in the United States and Europe, but to construct roads and power stations, classrooms and wards, modernise technology and transform public service delivery, Manuel noted.

Road, railways, classrooms, clinics ...
The 2009 Budget makes a further R6.4-billion available for public transport, roads and rail networks; R4.1-billion for school buildings, clinics and other provincial infrastructure projects; and R5.3-billion for municipal infrastructure and bulk water systems.

Housing and the eradication of informal settlements remain at the forefront of the government's infrastructure investment plans, he said, adding these issues significantly affected both employment and poverty reduction.

"In the past three years, the municipal infrastructure grant programme has spent about R32-billion. Over the next three years, infrastructure grants to municipalities total R67-billion, and a further R45-billion will be spent on the Breaking New Ground housing programme.

"Together with investment in roads and public transport, these constitute one of the largest areas of expansion of public sector spending, and are rightly prioritised as part of our response to the current deterioration in employment and economic activity."

State-owned enterprises
Of the budgeted R787-billion for the next three years, R390-billion will be spent by state-owned enterprises, Manuel said.

The government will also allocate R25-billion over the next three years to the Rail Commuter Corporation to invest in new trains and introduce new train routes. The budget for rail safety inspectors to reduce accidents and delays is also being increased.

The R25-billion Gautrain project, which recently enjoyed a successful maiden test run with journalists aboard, is nearing completion, with the link between Sandton and the OR Tambo International Airport to be completed by early 2010.

The Bus Rapid Transit system will receive R12-billion over the next three years.

"We are also budgeting R1.6-billion for South African Airways to support its turnaround strategy, which includes reducing costs and improving efficiency," Manuel said, adding: "I am sure that the House will agree with my hopes that this will not be a recurring allocation."

The state airline has been fraught with financial difficulties in the past, with the government having to come to its aid on numerous occasions.


Source : http://www.buanews.gov.za/

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R5.4bn for criminal justice revamp
Michael Appel

11 February 2009

Finance Minister Trevor Manuel on Wednesday announced a R5.4-billion allocation for the overhaul of South Africa's criminal justice system.

Efforts to review the forensic and investigative capacity of the South African Police Service are already under way, and together with enhanced technologies would give a welcome boost to the country's fight against crime, he said during his 2009/10 Budget speech to Parliament in Cape Town on Wednesday.

"A further R5.4-billion is allocated to interventions aimed at improving criminal justice services, the creation of an integrated fingerprint and DNA database, improving detective capacity, [and] upgrading IT and telecommunications systems," Manuel said.

The funds will also go towards increasing the number of police officials from 183 000 in 2008/09 to over 204 000 in 2011/12.

Funding is also provided for additional policing capacity during the 2010 Fifa World Cup, for building new prisons and for implementing the Child Justice Bill.

In his state of the nation address on Friday, President Kgalema Motlanthe said that crime remained a major source of insecurity for South Africans. "Daily experience, in poor and affluent neighbourhoods alike, is one of apprehension at the possibility of violent attack."

Motlanthe said that while South Africa's overall crime rate, having peaked in 2002, had consistently declined since then, it was still not dropping fast enough.

"The fact that incidents of violent robberies in households and businesses have been on the increase, and crimes against women and children have not abated in any significant measure, is a matter of great concern," he said during the opening of Parliament.

South Africa's crime situation, Motlanthe said, pointed to weaknesses in building the bonds of community solidarity, weaknesses in the criminal justice system - from investigation of crimes to rehabilitation of offenders - as well as weaknesses in the efficiency of the court system, both in terms of technical and other infrastructure and management.

South Africa's economy
Tough times ahead
Feb 12th 2009 | JOHANNESBURG
From The Economist print edition

But Africa’s biggest economy may still recover quickly from a looming recession

Reuters

ANY lingering hopes that South Africa might escape relatively unscathed from the global economic storms were dashed on February 5th when Tito Mboweni, governor of the central bank, predicted that Africa’s biggest economy would go through “a rough patch for the next three to four years”. Any politician who did not pass on that message to voters was “living in cloud-cuckoo-land”.

The same day, in an attempt to stimulate the economy and mitigate the effects of a recession, the bank chopped interest rates by a full percentage point to 10.5%, the biggest single reduction since 2003. As Mr Mboweni confessed at the time, he personally would have preferred a two-point cut. This week he signalled that if growth figures for the last quarter of 2008, due out on February 24th, were worse than expected, there could be a further cut in rates ahead of the monetary-policy committee’s next scheduled meeting in April.


Like the rest of Africa, South Africa had until recently been doing relatively well. Between 2004 and 2007, its economy grew by a perky 5% a year, after averaging a still respectable 3% over the previous decade. Last year it had been expected to expand by around 4%. But after slowing to a virtual standstill (up just 0.2%) in the third quarter—its worst performance in a decade—it will be lucky to reach 3% for the whole year. In the final quarter, the economy probably actually shrank, by as much as 4.6%, some economists reckon.

This shows that, unlike the rest of the continent, South Africa’s relatively sophisticated and open economy is exposing the country to the full wrath of the global crisis. There is now a serious risk that South Africa, hitherto fairly well protected by its well-regulated banking system from some of the squalls, will follow its main trading partners in America, Europe and Japan into a technical recession—two successive quarters of negative growth—for the first time in 17 years.

Almost every day seems to bring more bad news. Manufacturing, mining and the retail trade, which together account for more than one-third of South Africa’s GDP, are already formally in recession. Last month, new car sales plunged by 35%, the biggest drop in 25 years. The property market, in the doldrums for the past two years, is preparing for an even worse year ahead. Meanwhile, shrinking world demand and plummeting commodity prices have resulted in a sharp dip in South Africa’s exports.

So companies have begun to announce big lay-offs as demand falls and factories close. The official unemployment figure already stands at 23% (unofficially it is probably 35% or more) and is set to rise. Between 2003 and 2007, some 500,000 new jobs were being created every year. This year around 250,000 jobs are expected to be lost, so millions more will sink below the poverty line. Of the 4m officially deemed jobless, only just over 500,000 are eligible for unemployment benefit.


Still a rainbow country of extremes
Since the ruling African National Congress (ANC) came to power in South Africa’s first democratic elections in 1994, absolute levels of poverty have declined. But the discrepancies in wealth are still huge despite government job-creation schemes and the expansion of welfare benefits. The income of the top 10% of the population (still predominantly white but including a growing number of middle-class blacks) is nearly 100 times that of the bottom 10%.

Exacerbating the uncertainty over the country’s economy are the national and provincial elections which, President Kgalema Motlanthe announced this week, will be on April 22nd. The ANC is bound to win. But there is concern about a possible leftward shift in economic policy under Mr Motlanthe’s successor, Jacob Zuma. As the ANC’s leader, he will be ruling in alliance with the South African Communist Party and the Congress of South African Trade Unions, better known as COSATU, the country’s main union federation.

Are such fears justified? The ANC’s election manifesto, which reads more like a wish list than a set of firm pledges, is too vague to indicate exactly what direction the new government will take. Mr Zuma, who is almost certain to be the next president despite his continuing legal problems (he is facing trial for corruption), insists there will be no radical shift to the left. But he recently hinted at a more interventionist approach, declaring that the “days of the state remaining aloof from the market are now gone”.

Many will be looking to see whether the well-regarded Trevor Manuel, South Africa’s finance minister since 1996, will keep his job. It was largely because of his prudent macroeconomics that government debt was slashed (from 48% of GDP in 1994 to 31% in 2007) and that South Africa achieved its first-ever budget surplus in 2007-08. Though that trend will now be reversed (he has just announced a budget deficit of 3.9% for 2009-10), it has given the government some useful wiggle room. Mr Manuel has gained an almost mythical status for competence and integrity among foreign investors. His high (fourth) place on the ANC’s recently announced list of candidates suggests Mr Zuma will want to keep him on. Whether Mr Manuel will agree is another matter.

Although South Africa’s economy has been taking a severer battering than expected, it may still be better placed than many others to weather the storms. On the bright side, the banking system looks healthy. Inflation, in double digits for most of last year, is projected to sink to under 6% this year and next. Interest rates are expected to keep falling; though this may further weaken the rand, it should help South Africa’s exports.

All this, along with plans to spend 787 billion rand ($79 billion) on infrastructure, including preparations for hosting next year’s World Cup for football, may, with a bit of luck, let the economy pick itself up fairly fast once the world crisis begins to pass. Mr Manuel predicts growth of 1.2% this year, 3% next year and 4% in 2011.
http://www.economist.com/world/mideast-africa/displaystory.cfm?story_id=13109968

Some 4,5m work opportunities targeted during second phase of Public Works push

By: Brindaveni Naidoo
20th February 2009

The Expanded Public Works Programme (EPWP), now entering its second phase, is set to grow fourfold in the next five years, creating 4,5-million work opportunities.

With a budget of R4,2-billion dedicated to a new fiscal system, which is designed as an incentive scheme, the real question is whether this phase can purge the criticisms levelled at the first phase, which often targeted the duration of the work opportunities, and the limited impact it had on decreasing unemployment and poverty.

"We set a goal of one-million jobs for the first phase and achieved it, and in the second phase, the EPWP needs to stretch the targets," says EPWP chief director Ismail Akhalwaya.

In the State of the Nation Address, President Kgalema Motlanthe said that by the EPWP achieving its one-million work opportunities in 2008, a year earlier than envisaged, had now "created the possibility to massively to expand the programme and improve its quality". He also pointed out government's plans to intensify public sector employment programmes, and to speed up the introduction of the next phase of the EPWP.

The second phase has introduced the concept of full-time equivalent (FTE) jobs, of which it aims to create two-million FTE jobs, equating to 230 working days a year at a wage between R50 a day and R100 a day.

But Akhalwaya stresses that this "huge task", is not the solution to unemployment - a view that has resulted in much of the criticism received for the first phase of the programme.

Officially started in 2004, the programme has been implemented through existing government structures and within departmental budgets. The focus has been on the expanded deployment of labour-intensive construction methods to build, upgrade and maintain infrastructure in underdeveloped rural and urban areas.

In addition various environmental programmes including the clearing of alien invasive plants and restoration of wetlands have been implemented. Key social programmes focusing on caring for elderly and terminally ill as well as care and education for children in grade 00 and 0 have been intensified.

Akhalwaya says that this is a strategy that government has implemented to deal with the large number of individuals who want to find work but cannot. "The only way the State can directly create employment is through the expansion of the civil service and short-term interventions while we wait for the economy to turn around and for the private sector to generate wealth and create employment. And this is a progressive strategy of government to get money into the hands of the destitute, rather than increasing social grants," he adds.

Greater Non-State, Municipal and Provincial Role
The constraints identified in the first phase of the programme included: the limited authority of the Department of Public Works (DPW) to compel contributions from provinces and municipalities, a lack of incentives for provinces and municipalities to maximise their employment creation efforts, and a lack of capacity among certain public bodies and insufficient political mobilisation in some areas.

Against this background, phase two, while retaining the main focus of the first phase, will include a new focus on creating more employment in the maintenance of public infrastructure. The EPWP will now partner with communities, nongovernmental organisations (NGOs), community-based organisations and local communities through the community works programme.

Akhalwaya points out that the introduction of the non-State sector is crucial to the success of the EPWP, as the different spheres of government will not be able to generate, on their own, the number of jobs that are required, even with an increased programme budget.

And to assist with the mobilisation of provinces and municipalities and the funding of the additional wage costs of the scaled-up EPWP, a wage incentive has been introduced. This is based on performance and is not a planning-based allocation.

For the first year, it will focus on infrastructure sector programmes and the non-State sector, expanding into the environmental sector in the second year.

To be eligible, provinces and municipalities need to meet minimum participation targets for women, youth and people with disabilities, and employment creation targets using their conditional infrastructure grants, as well as report on their contribution to the EPWP to the DPW.

All the provinces and 44 municipalities will be eligible to access the incentive in the first year. These public bodies will enter into an agreement with the DPW committing them to a set of mutually agreed targets and in terms of which the DPW will provide the wage incentive.

Depending on the performance of the noneligible municipalities, additional ones will be eligible from 2010/11. Targets, which must be met in order to become eligible, are based on allocations provided to provinces and municipalities as well as past performance.

This incentive, which is similar to the job guarantee scheme in India, says Akhalwaya, is a departure from the first phase, in which the department had no leverage to prevail on municipalities, or provinces to implement the EPWP.

"Beyond attempting to get the incentives to work, I think the department fully realises that we need to have a very efficient system of paying back money. And the expansion into the non-State sector is also new - how we engage and expand the community works programme and partner with NGOs is going to be a significant challenge," says Akhalwaya.

Meanwhile, given the global economic downturn, there appears to be greater focus on the public works programme as there is likely to be an increase in retrenchments and slower growth in employment.

Akhalwaya agrees that now, more than ever, globally and in South Africa, there is mounting pressure on creating public works programmes and scaling up existing ones.

In the US, President Barack Obama aims to create what is being dubbed the largest public works programmes in the US since the 1950s. While there is no value attached to the programme as yet, it aims to create about 2,5-million jobs to assist the nearly two-million who have already lost their jobs.

No doubt, the debate on the appropriateness of labour-intensive methods, as well as the efficacy of the EPWP, will continue to rage. But what is less debatable is the current economic crisis and for a developing country that is attempting to grapple with its poverty and unemployment rate since 1994, a public works programme will always be necessary until the economy experiences an upward growth rate that no longer requires a short-term employment intervention.

^^ Although I appreciate the efforts to create jobs as detailed above. The problem is that these are mostly temporary. Thus a person be might be able to get a job now, but they'll wait a while before getting another one. The incomes are not consistent nor regular enough.

True Lefa, job sustainbility is necessary to eradicate poverty.

^^ SA is turning into a social state, we need factories and relaxed labour laws to effect long term change.

SA to get R80m nanotech centre

By: Creamer Media Reporter
20th February 2009

The National Research Foundation (NRF) on Friday stated that it was spearheading an R80-million national High Resolution Transmission Electron Microscope (HRTEM) centre.

The HRTEM centre would be located at Nelson Mandela Metropolitan University (NMMU) in the Eastern Cape.

“No longer will our postgraduate students and researchers working in the field of nanotechnology need to trek to Europe and North America and wait in line to use scientific equipment there,” said NRF executive director for human and institutional capacity Dr Romilla Maharaj.

The equipment at NMMU would be available as a resource to all South African and African universities, as well as researchers in industry.

The NRF has partnered with the Department of Science and Technology (DST), the NMMU, synfuel producer Sasol and the Pebble Bed Modular Reactor as key funding partners in this venture.

Nanotechnology was one of the lead strategies of the DST. In launching the strategy in 2006, the DST Minister Mosibudi Mangena argued that in an increasingly competitive global economy marked by the technology divide between the developed and developing worlds, it was even more urgent for science and technology to be a robust arbiter in advancing equitable human progress.

Government’s nanotechnology strategy strengthened the country’s integrated industrial focus and advanced the national technology missions that have been identified in the national research and development strategy. Nanotechnology crosscuts biotechnology, technology for manufacturing, information technology and can improve the country’s natural resource sectors and technology for poverty reduction, the NRF said on Friday.

Nanotechnology also promised more-for-less, smaller, cheaper, lighter and faster devices with greater functionality, using fewer raw materials and consuming less energy. Its most prominent application is the cellphone yet it can be found in areas as diverse as surgery, kitchen appliances and motor vehicles.

Alarm raised over South Africa's disappointing GDP figures

Its official : South Africa is facing its biggest economic downturn since the dawn of democracy in 1994. Growth Domestic Product figures released by Stats SA today show that the economy contracted by 1.8% at the end of last year from a marginal growth of 0.2% in the previous three months.

The contraction was worse than expected and there are now calls for government to take drastic action pull the country out of its economic hole. The gloomy economic data was worse than most economists expected. Its impact is devastating and Trade Unions are crying out for help.

Congress of South African trade unions (Cosatu) General-Secretary, Zwelinzima Vavi says: “We’re sitting with a situation where almost weekly we are negotiating retrenchments - we're not talking about five to 10 people we're talking about thousands and thousands. We’re up to here running from factory to factory trying to save jobs, government must help us."

The Finance minister, Trevor Manuel, was not available for comment while his Director General was summoned to the Union Buildings for a day-long meeting presumably to discuss the crisis. But with the current government only left with just over a month in office, it will be up to the new administration- possibly with a new Finance Minister- to turn things around.

New administration urged to critically review economic state

SA Chamber of Commerce and Industry, Nerend Rau, says: “What we would like to see is that the new government, when they take power, critically review the economic state that they have been handed, look at the sub components of the manufacturing sector very critically to see where government can lend support."

According to Stats SA, the manufacturing sector was the biggest casualty crashing by almost 22% having already declined by 9% in the previous quarter; and the wholesale and retail sector contracted by 0,2 after a slump of 6, 9% in the previous three months. Construction growth slowed by 5% compared to the previous quarter and mining failed to recover from a slump of almost 9% in the third quarter only gaining 0, 4%.

All eyes are now on the Reserve Bank - both business and labour are calling for a drastic emergency rate cut soon. A spokesperson for the Reserve Bank said the bank had not ruled out an emergency MPC meeting but said a decision had not yet been taken.

It wasn't as bad as Nedbank was expecting, on the bright side...lol.

It wasn't as bad as Nedbank was expecting, on the bright side...lol.

It was the worst performance since the second quarter of 1993 when the economy fell by more than -5% which was 17 years ago. In 1998 when the economy came close to recession the decline was only -0.9% in the third quarter of that year. Economists predict a further -1.5% decline in the 1st quarter of this year. I would not be surprised if we see a decline for the entire year reach -2.0% which will be the worst on record since 1992.

^^ I didn't say it wasn't.

Not good.

In a recession...just spend more!

Gauteng to spend R40bn on infrastructure projects

By: Chanel Pringle
24th February 2009

The Gauteng provincial government (GPG) would spend about R40-billion in infrastructural projects over the next three years, in a move that could help to mitigate the impact of the global economic slowdown on the province, Gauteng Finance and Economic Development MEC Mandla Nkomfe said on Tuesday.

Announcing the GPG’s 2009/10 budget, he noted that these investments would include transport projects, construction projects and roads and related infrastructure for the 2010 FIFA World Cup.

“We are hoping that by rolling out this massive infrastructural programme, economic centres that are hidden, scattered, or badly utilised will be ignited and channelled towards the creation of new wealth that is required to achieve a high rate of economic growth and development,” said Nkomfe.

He added that this was Gauteng’s “economic fiscal stimulus package”, with the projects expected to have long-term benefits for the province’s economy and its people.

“To this end, government investment to the Expanded Public Works Programme (EPWP) will be stepped up in the coming years to provide both necessary skills and employment,” commented Nkomfe.

Further, the provincial government has also encouraged development finance institutions to explore “innovative” ways of financing strategic infrastructural projects, he stated.

The GPG would spend R55,3-billion in the 2009/10 financial year.

Over the medium-term expenditure framework (MTEF), the Gauteng Department of Public Transport, Roads and Works would spend R11,7-billion on infrastructural projects.

These would include the Gautrain rapid-rail project, which would receive funding of R6,3-billion, the implementation of the EPWP, road infrastructure and the Kopanong Precinct project.

The road infrastructural conditional grant had been allocated an additional R1,6-billion over the MTEF.

Other priorities for the province remained housing, health, education, social development, community safety and economic development, among other things.

Meanwhile, the GPG was also working with the manufacturing sectors to look at developing programmes to help these sectors curb potential job losses and to expand the sector’s capacity to create new jobs, said Nkomfe.

inflation at 8,1% - posible rate cut of 100bp next month.

South Africa sees economy shrink

Construction has helped South Africa avoid a technical recession
South Africa's economy has shrunk for the first time in 10 years, official figures have shown.

Gross domestic product (GDP) fell by 1.8% in the last three months of 2008 from the previous quarter.

It came as Lonmin, the world's third-biggest platinum producer, said it was cutting up to 5,500 jobs at two South African mines.

A worldwide commodities slump has seen dramatic falls in demand and prices of metals and other mined products.

UK-listed Lonmin said a deal to cut 4,000 jobs at the Marikana mine in North West province and 1,500 in Limpopo province had been agreed with unions.

It has been hit by tumbling demand from the car sector which uses platinum to manufacture catalytic converters.

"With the current backdrop of challenging economic conditions, these agreements are an important milestone in our objective of restructuring the company," said Lonmin chief executive Ian Farmer.

Diamond decline

Overall, South Africa's economy grew by 3.1% in 2008, official figures showed.

This was well below the government forecast of 3.7% and the previous year's 5.1%.

Construction ahead of the 2010 World Cup is expected to continue giving the country an economic boost.

However, Southern African economies which rely heavily on commodities such as diamonds, gold and industrial metals have been particularly badly affected.

Gold production dipped 13.6% to the lowest level since 1922, according to the Chamber of Mines - meaning it is now only the third largest gold-producing nation behind China and the US.

Last week, mining giant Anglo American said it would cut 19,000 jobs this year after a 29% fall in profits.

It blamed the fall in earnings on sliding demand for raw materials.

And earlier this week Debswana, a diamond producing firm jointly owned by Botswana's government and De Beers, said it would close two mines for the rest of the year because of falling demand.

Debswana's four diamond mines will close on 25 February, but two of them will resume work on 14 April.


Intresting article from the BBC just about this - heres the link - http://news.bbc.co.uk/1/hi/business/7907603.stm

South Africa : R1.8 billion boost for rural development

February 14, 2009 - 00:26 — AA Network
By Nthambeleni Gabara

Parliament - South Africans living in rural areas especially female farmers are set to benefit from government's R1.8 billion boost to rural development and smaller farmer support.

"Increasing agricultural output, raising rural incomes, supporting small scale farmers and investing in rural roads are key objectives of government's rural development strategy," Finance Minister Trevor Manuel said.

Tabling his Budget Speech in Parliament on Wednesday, Minister Manuel said the financial injection was seen as a step by government towards ensuring women's economic empowerment through the Women's Agriculture and Rural Development (WARD) initiative and the Micro-Agricultural Finance Institution of South Africa (MAFISA).

WARD is an initiative aimed at highlighting gender-related issues in agriculture and focuses specifically on land policies, programmes and projects.

It was launched nationally in August 2006 by Agriculture and Land Affairs Minister Lulu Xingwana.

MAFISA provides financial services to facilitate the development of micro and small agri-businesses into larger businesses.

Both initiatives were implemented as small farmers, particularly women in rural areas, still experienced problems when they needed access to financial assistance, land and relevant information including their rights regarding land reform.

Minister Manuel further encouraged the partnerships between private farmers and villagers to use the land for food production and sustenance.

He said South Africans should take the issue of increasing food prices seriously and develop their own private vegetable gardens.

The Department of Agriculture has implemented a campaign known as Ilima/Letsema to encourage food production in each of the nine provinces.
As part of the programme government provides starter packs, which include farm implements, to emerging farmers. - BuaNews

A report in the SABC's Ndebele News stated that unemployment in SA for the last quarter is 21%.Now my Ndebele is bad so it might have been another number in the 20s.Besides that,I thought unemployment was hovering in the 40s...I read this on the BBC News site.

I also thought it was in the 40s. Well that's good to know. It's still way too high, but much, much better than in the 40s.

I smell a rat,a lying rat that goes by the name Statistics South Africa.

^^ Stats SA have always released stats that keeps government on its toes. They have actually changed the way they capture their stats and that might be one of the things that have resulted in that report. Thabo Mbeki has on previous occasions lashed at Stats SA for have improper statistics because he said that they do not take into consideration those who have deserted seeking employment and running thier own businesses.

I wouldn't blame Stats SA for the reports as per Thabo Mbeki as most business in the locations are not registred and so it would be difficult for Stats SA to produce 100% correct stats. I got friends and other people I know who are running succesful business and have employed more than 2 people but they are not registered. The sad part is the fact that most of them do not want to register as they say that they will be taxed with no service delivery in return.

There are two unemployment measurements: a broad measurement (which includes people who want to work but have given up looking for work) and a narrow measure (those actively seeking work who can't find it). The broad measure is around 40%. But StatsSA publishes the narrow measure (as does every other country in the world: European and American unemployment statistics do not include people who have given up looking for work.)

The narrow measurement of unemployment has fallen to 21.9% from 23.1%. But part of that comes from people dropping out of the labour market altogether (they have given up hope of finding employment). Here is the SABC news report in English:

_4MM-In3gfI&feature=channel_page

The current account deficit for 2009 is projected at 10% of GDP. I am wondering how South Africa will finance such a large deficit when FDI and foreign portfolio inflows have dried up.

does it exclude or include lazy people?
we have many in our country.

SA's first food bank opens in Philippi, Cape Town



By DEVIN HERMANUS

SOUTH AFRICA's first food bank has opened its doors in Philippi and is to provide 13 500 meals a day to the poor.

An estimated 19 million people in the country do not know where their next meal will come from, according to FoodBank SA.

A food bank is a centralised storage and distribution point for social service organisations that are providing food aid in a specific area.

It sources, stores, packages and distributes excess food for agencies.

In partnership with the department of social development, non-profit organisation FoodBank SA's first branch in Philippi is to provide food for those within 300km of the city centre who would otherwise have little - or nothing - to eat.

FoodBank SA is to launch several more such centres in Durban, Port Elizabeth and Johannesburg soon, and is also to branch out into smaller, rural areas.

The Cape Town food bank is a consolidated effort with Feedback Food Distribution, Lions Food Project and the Robin Good Initiative - charities that have collected and redistributed food parcels to shelters, soup kitchens and needy schools across the province for several years.

Collaborating with major food retailers, farms, non-government organisations and private donors, the food bank will be able to assist almost 400 beneficiary agencies.

FoodBank SA chairman Crispin Sonn said although he was "incredibly excited" at the much-needed initiative, it was "a sad indictment" of the country that a food bank was needed.

"Since the 1970s, the country was able to provide a surplus of food. How can our people move forward if they are not fed?"

The director-general of social development, Mondli Mbhele, said government sectors would look to food banking to provide aid for the hungry and possibly create jobs.

devin.hermanus@inl.co.za

Published on the web by Cape Times on March 4, 2009.

Contagion?

Feb 19th 2009

From the Economist Intelligence Unit ViewsWire

South Africa's economy is set to shrink

South Africa's economy is set to shrink this year, as the global downturn affects financing and external demand. Growth should rebound next year, however, easing pressure on politicians.

With South Africa's leading domestic and global indicators continuing to deteriorate, the Economist Intelligence Unit (EIU) has again revised its growth forecast downwards. Indeed, we now expect South Africa's real GDP growth to contract by 0.8% in 2009—reflecting tough financing conditions, and much weaker external demand and prices for the country's commodity exports (excluding gold)—before posting a recovery in 2010 as the global economy begins to recover and the World Cup is held. A sharp deterioration in consumer and business confidence means that there is a high risk that the South African economy may enter a deeper-than-forecast recession. The South African Chamber of Commerce and Industry's business confidence index fell almost 2% to a six-year low in December 2008, and the one-percentage-point cut in interest rates has done little to brighten the mood, with many businesspeople believing that the central bank should have gone further. Similarly, month-on-month output and retail sales data for the final months of 2008 indicate that the downturn could be steep, for the first half of 2009 at least.


The government is seeking to tackle the impact of the global slowdown, announcing a stimulus plan based primarily on fiscal measures. The four main aspects of this programme are:

• To push ahead with the R690bn (US$69.4m), three-year public investment programme by tapping all sources of possible funds, including domestic and international development finance institutions (DFIs) and public-private partnerships.

• To expand public-sector employment opportunities.

• To increase social spending, by progressively raising the eligibility age for child-support grants to 18 years and by cutting the pension age for men to 60 years.

• To help the private sector to cope with the slowdown by, for example, adapting industrial incentive schemes, providing assistance from local DFIs and exploring alternatives to job-shedding (such as subsidised training).

The administration has also pledged to oppose protectionism, both locally and globally, which is welcome. However, there is a limit to what the government can do on the spending front, especially given the negative impact of slowing growth on fiscal revenues, and the promise not abandon prudence.

The latter is a crucial consideration. There is considerable nervousness among investors that South Africa's next president—likely to be Jacob Zuma—will oversee a leftward shift in economic policy. Global recession and heightened risk aversion will certainly compound the challenges facing South Africa's new policymakers, but the African National Congress is expected to continue supporting a market-based system complemented by a development-focused state. That said, there will inevitably be a rethink in some areas. For example, the next government is likely to put greater emphasis on and resources into job creation, via the expanded public works programme. There is also likely to be a growing focus on tackling AIDS and high levels of violent crime, as well as on land reform and broad-based black economic empowerment. The EIU nevertheless believes that the government will maintain a framework of macroeconomic discipline and will resist left-wing calls for the scrapping of strict inflation targeting and fiscal prudence, and that pressure on politicians will ease somewhat in 2010 as real GDP growth rebounds, to 3.1%, helped by the preparations for, and hosting of, the World Cup in June/July.

Mahindra capitalises its local subsidiary, commits to SA

By: Irma Venter
16th March 2009

Vehicle manufacturer Mahindra & Mahindra had invested a further R30-million in its local subsidiary, Mahindra South Africa (MSA), this as both global and local automotive companies were witnessing a substantial downturn in sales and profitability as the global credit crisis continued.


“South Africa is very important and strategic in our overall globalisation strategy and we are committed to this market,” said Mahindra & Mahindra automotive sector president Dr Pawan Goenka in Johannesburg on Monday.

“We have taken a number of initiatives to ensure the long-term success of our business in South Africa. The South African market will turn around, and we'll be there to show we are a serious player.

“Apart from the infusion of the required cash and plans for the introduction of new range of products, starting with Xylo and some other products in the near future, we aim to continuously build the brand Mahindra in South Africa.”

Goenka was in South Africa to introduce Mahindra's new multipurpose Xylo to the local market, adding to the existing line-up of Bolero and Scorpio pick-ups and sports utility vehicles.

MSA CE Vijay Nakra said the eight-seater Xylo could replace the gap left in the local market by the now defunct Toyota Condor.

Pricing started at R159 900.

Other Mahindra products to be introduced later this year included the Legend Jeep-style vehicle, with which Mahindra had won its fame in the 1940s.

“Over the next two to three years there will also be a completely new pick-up, as well as a new sports utility vehicle (SUV),” said Nakra, “as well as a range of 0,5 t to 0,8 t small commercial vehicles.”

Nakra said MSA had sold just short of 11 000 units in South Africa since its inception in October 2004.

However, the company had experienced a tough 2008, when sales had dropped to 1 700 units, down from the more than 3 000 units in 2006 and in 2007.

Sales at Mahindra were down more than the overall local market decline of 21% seen in 2008 compared with 2007.

Nakra was hesitant on Monday to make a sales forecast for the year, but said he expected 2009 to be better to the company than 2008, on the back of the expected new product launches.

However, he added that the current soft market did not bode well for Mahindra's plan to eventually manufacture its products locally, as had been announced at its inception.

“We said we'll consider it at sales of around 6 000 vehicles a year, but we must revisit this figure now,” noted Nakra.

“We'll also have to look at the impact of the phase-put of the Motor Industry Development Programme (MIDP), and the introduction of the Automotive Production and Development Programme (APDP).

The MIDP is an import/export complementation arrangement, whereby the local content value of components or built-up vehicles exported, earn credits that can be used to rebate import duties on components and vehicles.

It is due to come to an end in 2012.

In contrast to this, the new APDP will provide incentives on the basis of production volumes (government previously noted a figure of 50 000 units a year), and not exports.

This does not favour smaller production facilities.

Mahindra & Mahindra has assembly facilities in Brazil and Egypt.

It aims to enter the US market shortly, with a pick-up, as well as a SUV model.

China-Africa Development Fund opens SA office

By: Keith Campbell
16th March 2009

The South African Department of Trade and Industry and the China-Africa Development Fund (CADF) signed a memorandum of understanding in Johannesburg on Monday.

At the same time, the CADF opened its representative office in South Africa.

Speaking at the ceremony, deputy Trade and Industry Minister Elizabeth Thabethe stated that areas covered by the MoU included mining, energy, infrastructure and information and communications technology.

She pointed out that the creation of the CADF was one of the steps by China to develop a new relationship with Africa. She added that the opening of the CADF representative office in South Africa represented a new era in the relationship between Africa and China.

Also speaking at the ceremony, African National Congress secretary-general Dr Matthews Phosa affirmed that South Africa was fast learning to look also to the East for economic partners.

He said that China has set an example by becoming one of the leading economic forces in the world and that China had also shown that it wanted to cooperate with Africa.

Phosa added that it was very clear that there was a Chinese focus on investing in South Africa and assured that such investments would be welcomed in the country, the region and the continent.

He expressed the view that the willingness of the China Development Bank (CDB) to invest in Africa at a time of global economic meltdown was hugely impressive.

The CDB is currently the sole shareholder in the CADF, which was launched in June 2007, with an initial tranche of $1-billion and a total capital investment which will ultimately reach $5-billion.

The chief governor of the CDB, Chen Yuan, reported that the CADF had made investments of nearly $400-million in projects in Africa. These investment were facilitating more than $2-billion of further investments in Africa by Chinese companies.

Yuan stated that the representative office in South Africa would provide means to accelerate investments and develop further cooperation between Chinese and African businesses.

Chinese Ambassador to South Africa, Xhong Jianhua, reported that the Embassy was seeing more Chinese business coming to South Africa and the African continent.

ANC Looks to Cosy Up to China
Mathabo Le Roux

17 March 2009

Johannesburg — AFRICAN National Congress treasurer-general Mathews Phosa says the partnership between China and SA will be stepped up after the election.

"After the election we will see an increase in co-operation between China and SA. The seeds have been sown," he said.

Phosa was speaking at the launch of a representative office of the China-Africa Development Fund in Johannesburg -- the first of its kind in Africa.

Established in 2007 by the China Development Bank, the fund stems from a pledge by Chinese President Hu Jintao at the China-Africa Co-operation summit in Beijing in 2006 to foster closer ties with the African continent.

It was set up with an initial capital injection of $1bn by the China Development Fund, but capitalisation will eventually reach $5bn, said Chen Yuan, chairman of the China Development Fund.

The Department of Trade and Industry yesterday also signed a record of understanding with the fund to establish a framework for co-operation.

Deputy Trade and Industry Minister Elizabeth Thabethe said the collaboration would earmark strategic sectors for investment, including mining, transport, energy, agriculture, manufacturing, infrastructure development, and the information and communication technology sector.

Phosa said the fund's pledges to invest in the continent at a time when the financial meltdown had seen investment and trade finance in emerging economies dry up, should be welcomed.

Since its inception, the fund has invested $400m in 20 projects in Africa, notably a cotton project in Malawi, a power plant in Ghana, a glass factory in Ethiopia and trade zones in Egypt and Nigeria.

Business Day (http://www.businessday.co.za/articles/economy.aspx?ID=BD4A960780)

I'm not very keen on this deal. I think it might benefit China more than it does us...

gosh are the ANC Stupid, look what china have done in the DRC and Somalia, just look at their work in the DRC that is why they are now the worlds largest producer of gold....i cannot help but worry about the implications this will have on SA, i see a lot of corruption looming!

Everyone is frothing at the mouth to deal with China, so why is it stupid for SA to forge stronger trade links?
European companies have been mercilessly extracting Africas resources for centuries with not an ounce of compassion or upliftment of local people, and continue right at this moment.
Do you think trade deals with, the US, for example, benefit anyone except the US?

And whilst corruption is a concern, this is not the DRC, for crying out aloud. I say go for gold, as long as we keep a lid on the shady side of any deals...

Everyone is frothing at the mouth to deal with China, so why is it stupid for SA to forge stronger trade links?
European companies have been mercilessly extracting Africas resources for centuries with not an ounce of compassion or upliftment of local people, and continue right at this moment.
Do you think trade deals with, the US, for example, benefit anyone except the US?
+1

And whilst corruption is a concern, this is not the DRC, for crying out aloud. I say go for gold, as long as we keep a lid on the shady side of any deals...
I don't really understand the discontent for China when it comes to the DRC. China has invested billions into the country already (mostly in the mining sector), and is currently in the process of investing over $9 Billion U.S.D. in the infrastructure of Congo- something no other country would even think about doing. Even though we all know China isn't perfect when it comes to foreign investment (especially considering Chinese companies just love to send their countrymen into Africa to do the work, robbing many locals of job opportunities), no other country in the world would even think about injecting that much money into Congo.

On the other hand, Belgium prefers blackmailing the country by calling in old debts to try and hold onto the ever decreasing influence they have over the Congolese. China has done more good for Congo than any Euro country will ever do, and this is all in the last couple of years. If you want to talk about genocides, and other things related, then Belgium obviously takes the cake.

Rant over.

China build stadia across Africa as a gift to those countries.
We haven't been that lucky.

We already have stadia.

I agree that some good things have come from it, but they out weigh the negatives associated with the way they work. Even the diamond miners in Congo want them out, its hard to believe but they have actually become poorer as a result of Chinese mining companies moving in...i saw it on nat geo, on a show called "dont tell my mom where i've been" or something like that. Also the situation in Darfur giving the government weapons for oil was terribly unethical. I agree we need investors, but we need to get the right type of investors, ethical ones like the ones typically found in Scandinavian countries

not to mention they will not monitor how the billions they have invested get spent, without accountability i fear a lot of it will fall to the hands of high ranking officials and never end up used as intended, sad to say but safegaurds are needed in africa, its the responsible thing to do.

The US supplied the Mujahedin in Afghanistan. They have steadfastly refused to do anything about Sudan, for similar reasons to the Chinese.
For F*ck sakes, when communist Vietnam sent troops to stop the slaughter in Cambodia a few decades back, the US supplied the KHMER ROUGE with arms to counter them! The Rouge are arguably the most terrible regime in all history!
My point is, dont bring ethics into play when billions of *money* is at stake, or when a government has its own agenda.
China is no better or worse than any of them. Although I will concede that the Scandanavian countries are hard to knock in this regard...

I agree that the US have played a GInormous(made up word) role in messing up the world, look at the credit crisis. If we let China have their way, you can be damn sure things will get more difficult for africa. You only have to look at the pollution in chinese cities to know that the chinese wil do anything for the money (sluts). But the world is changing (climate change, green movement etc) and africa will be left behind once again because they traded with china just for the money and not the betterment of their citizens lives. With all respect Africa has a lot more to lose compared to China, e.g. scenery, natural resources, and last but not least the great nature and spirit of the African people, who have essentially become slaves again in the aforementioned areas of Congo.

I agree we need to watch closely, and battle for every deal we make - but again, my point is we need to do that with all suitors.
China is complex -they are outrageously flouting every law by being in Tibet, and I am militantly against that. (Ditto US in Iraq).
But they instituted the 'one child' policy years ago, something the world should be thankful for (India didn't, and they are about to overtake China in the population stakes).
China are also making huge efforts to combat pollution and greenhouse gas emissions.

I think I am just saying that we (the west) lurk behind this veneer of goodwill and righteousness and truth, but our actions don't tally up with that...
China buys our gold and other minerals - sure, drive a hard bargain, but go for it...

We already have stadia.

One can never have too many.

Agreed....what really gets on my nerves is how China will stop at nothing to make money (melamine scandal, lead toys, dangerously defective goods), this makes them less complex than people would imagine. This makes it clear to me that investment from them should be considered with much trepidation. Sure the west have standards that they dont necessarily live up to, but they make an effort. My point is that South African investments from china if not managed properly will be like selling our souls to Hades himself. Have you heard of the Singaporean firm called tamasek holdings? (their not really chinese but operate the same way as the chinese government) They were basically responsible for the coup in Thailand and the axing of Taksin Chinawat. On the face of it the investment seemed great, but look at what happened to Thailand a few months ago!

South Africa to export biodiesel to Germany
Thu Mar 19, 2009 3:58am

JOHANNESBURG (Reuters) - South Africa has secured a long term contract to export between 70-90 percent of the output from a planned 400,000 ton a year biodiesel plant to Germany, the Business Day newspaper reported on Thursday.

An environmental impact assessment for the project was underway, and production would start in 2010, the paper said citing on official for the East London Industrial Development Zone.

It said canola would be the feedstock for the biodiesel plant.

Reuters (http://www.reuters.com/article/GCA-BusinessofGreen/idUSTRE52I1VW20090319)

^^ those are great news, thanks Kwame.

South Africa to export biodiesel to Germany

does anyone know what crop, (sugar cane, wheat, sunflower oil etc) this biodiesel is made of? i hope it wont have an effect on crop prices. if it does i will consider biodiesel to be the fuel of satan, probably used to keep the fires in hell burning

SA auto industry to face increased pressure
The South African automotive industry is expected to face increased pressure this year, ratings agency Fitch said.

The South African automotive industry is expected to face increased pressure this year, ratings agency Fitch said on Friday.

In a special report, Fitch said that the global economic downturn was having an increasingly negative impact on South Africa's automotive sector.

As a consequence, the agency said it believed that the credit profiles of South African automotive companies were expected to come under increasing pressure over the next 18 months, and that a recovery in market conditions was not expected prior to 2011.

"The agency believes that companies with strong cash generation and financial flexibility will be better positioned to weather the current economic downturn.

Key rating drivers will include an increased focus on strong liquidity and the ability to de-leverage," Fitch said.

"The combination of the negative trends in vehicle sales, export data and GDP forecasts with the expected adverse impact on automotive companies' credit metrics, most notably leverage and cash flow generation, mean that further corporate downgrades seem probable in the short to medium term," said Raymond Hill, Senior Director and Head of Fitch Ratings' Emerging

Markets corporate team.

Fitch said that new vehicle dealerships were expected to be particularly affected by the economic slump.

New vehicle sales in South Africa dropped by 36.3% year-on-year (y/y) in February 2009, and by 35.4% y/y in January 2009, following a 27.1% y/y drop in December 2008.

The decline in sales represents the largest fall in the last eight years, and is expected to worsen as economic growth, global demand and consumer confidence decline further in 2009.

In the South African automotive sector, Fitch currently rates Mercedes-Benz South Africa (Pty) Ltd ('AA(zaf)'/'F1+(zaf)'), Bidvest Group Ltd ('A+(zaf)'/'F1(zaf)'/Stable), Barloworld Ltd ('A+(zaf)'/'F1(zaf)'/Negative), Steinhoff International Holdings Ltd ('A(zaf)'/'F1(zaf)'/Negative) and Super Group Ltd ('BB(zaf)'/'B(zaf)'/Rating Watch Evolving).

The ratings agency said that the negative outlook for the South African automotive sector extended to the manufacturing operations of international auto manufacturers with operations in South Africa, component manufacturers and new and used vehicle dealerships.

Joule gets capital boost as it aims for 2012 production date

By: Irma Venter
3rd April 2009

Cape Town-based Optimal Energy announced on Friday that it was gearing up for the start of mass production of its home-grown prototype Joule electric vehicle in South Africa in 2012.

Production volumes were estimated at an initial 50 000 units a year, said the company's executive manager for marketing Diana Blake.

This would mean Optimal Energy would qualify for incentives under the new Automotive Production and Development Programme (APDP), set to replace government's current automotive industry support scheme, the Motor Industry Development Programme, in 2012.

The APDP was set to provide incentives to plants with a production of around 50 000 units a year.

“We definitely want to qualify for the APDP,” said Blake.

It was estimated that 80% of Joule production would be exported, she added.

Optimal Energy's announcement came on the back of a further share issue to the Industrial Development Corporation (IDC), as well as the Innovation Fund, the technology investment division of the Department of Science and Technology, for a fourth round of capital investment.

Blake said this brought total government investment in the development of the Joule to roughly R155-milion.

She said the company intended to raise further private capital towards the end of this year.

“We estimate we need another R1,5-billion.”

Blake noted that there was more than sufficient interest in the project.

“We are speaking to a number of investors – mostly private investors.”

Optimal Energy had appointed Step Strategic Venturing, a professional services firm, to assist it with the development of its strategy, and with its capital raising process.

South Africans can reportedly look forward to seeing pilot fleets of the zero-emission Joule on the country's roads, and around the globe, from 2010 onwards.

The second prototype of the Joule was currently nearing completion, said Blake.

“Optimal Energy is capitalising on South Africa’s technological prowess, its track record of building premium cars for the export market, the current sea change in transport technology brought about by climate change, pollution and energy security issues, and the immense progress in battery technology,” noted Optimal Energy CEO Kobus Meiring.

“Optimal Energy aims to place South Africa at the front-line of the renewable energy movement with Joule. This investment helps us to drive the industrialisation process, taking us to the next level.”

Using a normal 220 V home outlet and Joule's onboard charger, it would take approximately seven hours to recharge the vehicle's battery for a 200-km driving range, with two packs providing a 400-km range in total.

Once production of Joule began, Meiring estimated that Optimal Energy, which currently employed more than 80 people, would increase its direct head-count to around one thousand employees, while a further 5 000 people would be employed in various related and support industries.

“We are in the process of selecting a site for our first assembly and manufacturing plant. The location of the plant will be announced later this year,” noted Meiring.

This plant could be at an existing vehicle production site, or it might be a completely new facility.

Meiring was previously programme manager of the Rooivalk Helicopter and Southern African Large Telescope projects.

The Joule was designed in association with South African-born automotive designer Keith Helfet, who had a long career as chief stylist at Jaguar, and was responsible for the designs of the XJ220, the XK180 and the F-Type models.

The six-seater Joule was set to retail for around R200 000, at today's prices.

Optimal Energy reported that the car's running costs would be one-tenth of a normal vehicle, as it would not use fuel, while also boasting longer service intervals.

Any Joule owner would only lease the battery, in order for Optimal Energy to ensure peak performance and proper maintenance.

Blake said the battery for the Joule would initially be imported, but that production was then to shift to the South African market, either by Optimal Energy, or by another supplier.

Meiring added that he did not expect the current global economic crisis to hinder the proposed production programme for the Joule.

“Interest in the vehicle has been enormous, both at a local and international level.

“The timing of this investment and the planned 2012 start of volume production is ideal. Current market conditions are slowing down the traditional manufacturers’ efforts, while the market, especially for clean vehicles, is predicted to be in a strong upward swing from 2012 onwards.”

Greaaat news.

Optimal Energy reported that the car's running costs would be one-tenth of a normal vehicle, as it would not use fuel, while also boasting longer service intervals.

I wouldn't mind one of these!

http://cdn.24.com/files/Cms/General/d/106/0f231419684c464695860bfa5d6d24f0.jpg

Large-scale production of the Joule, SA's first fully electric car, will only begin in 2012, two years later than originally planned. This is not because of the economic downturn, but rather the result of interest in the product

Optimal Energy is a Cape-based company responsible for the Joule's design and development. Initial plans were for to produce only about 4 000 units a year, but this figure has since been adjusted to 50 000 from 2013.

The Joule will be assembled at a single plant, rather than a number of small ones. The factory will probably be close to port, since 80% of total production will be destined for the export market. The Joule will require specialised sales staff and after-sales services. The plant will cost R1.5bn to build.

The Industrial Development Corporation (IDC) and the South African government's innovation fund have funded the vehicle's development. A fourth round of financing for the production stage was recently awarded to Optimal Energy. The development of recharging infrastructure for the car is also under way.

Optimal Energy recently had a meeting with Projects Better Place, a company working with governments worldwide to establish infrastucture for electric cars.

Blake is positive that the government will provide financial incentives for customers buying this type of car, "because it's not a cheap car - batteries remain expensive." A Joule would cost a customer about R200 000 today but save about 90% on fuel expenses and 50% on operating costs, compared with a conventional vehicle.

The car was developed by Keith Halfet, a former Jaguar designer from South Africa.

International thumbs up for Cape Town as it earns a double A credit rating

April 07, 2009 Edition 2

Metro Writer

CAPE TOWN has retained its double A credit rating for the third consecutive year - despite the global economic crunch - earning the highest score for a South African municipality after independent ratings agency Moody's International gave the city an Aa2.za rating.

"This is an exceptional feat, bucking the trend of credit downgrading for financial institutions," Ian Neilson, mayoral committee member for finance, economic, social development and tourism, said.

The city is one of a "handful" of municipalities to have been given an unqualified audit report from the auditor-general during the past five years.

Neilson said the positive rating would give potential investors a "strong vote of confidence" in the city's financial leadership and management.

Moody's report said the city's rating outlook was "stable" and that its key financial indicators would remain "sound in the medium term".

"The municipality will maintain a solid budgetary position, a prudent and conservative financial policy, and its indebtedness will remain manageable despite the ambitious capital expenditure programme," the report said.

The city has assets of R20 billion. Its revenue grew last year by almost 16 percent to R12.7bn.

Property taxes are the its main revenue source, contributing 25 percent of its revenue in this financial year.

The latest property valuation roll was more than R631bn, Neilson said.

"Cape Town remains largely self-funded, generating 86% of its revenue from own sources. This high proportion of discretionary revenue reflects the city's control over its revenue base and indicates a high degree of financial flexibility," Moody's analysis said.

Moody's noted the city's service and maintenance backlogs, but said its expenditure trends were predictable.

Cape Town chief financial officer Mike Richardson said: "During the past two years, the city stayed well within its budget targets and demonstrated a prudent approach to revenue and expenditure."

The R2,7-billion Vaal River Eastern Subsystem Augmentation Project (VRESAP) also known as the Vaal pipeline opened on April 1 and has started delivery of water to Eskom and Sasol in Mpumalanga.

"The growing water demands of Sasol and Eskom in the Mpumalanga Highveld region have necessitated the implementation of the scheme to transfer water via a 121 kilometre pipeline from the Vaal Dam near the Knoppiesfontein diversion structure into dams near Secunda. The project will increase the yield of the region's Vaal River System by 160 million cubic meters per annum."

http://www.info.gov.za/speeches/2009/09033110151001.htm

Also featured on engineeringnews.co.za's latest Real Economy Report.

JOHANNESBURG, March 27 (Reuters) - South Africa, the largest emitter of carbon dioxide on the continent, expects to build its first pilot plant for the capture and storage of emissions by 2020, a government official said on Friday.

The country, often commended for being most active among developing countries in fighting climate change, set a target to cap emissions by 2020-25, and to reduce them by mid-century.

Carbon capture storage has been identified as one of the ways to mitigate the country's greenhouse gas emissions.

Minerals and Energy Minister Buyelwa Sonjica said the government would ensure that funds were available to make this happen, along with industry and international support.

"If there is a need we will respond accordingly ... we want to meet the target and by 2020 see the plant established," Sonjica said at the launch of the carbon capture storage centre that will drive the research and progress in CCS.

The government-led agency in charge of the process, the South African National Energy Research Institute (SANERI), said it had already secured 25 million rand ($2.65 million) for the centre for the next five years.

"It's not sufficient to build the plant or do the test injection, but enough to get us up and running and complete the capacity building component," said SANERI's Acting Chief Executive Tony Surridge.

South Africa, Africa's largest emitter and 12th in the world, depends on coal for 90 percent of its power.

Sonjica commended the industry's involvement in the project.

The signatories include petrochemicals group Sasol (SOLJ.J), state-owned utility Eskom [ESCJ.UL], together responsible for more than half of the country's emissions, which altogether amount to more than 400 million tonnes of carbon dioxide a year.

Other partners include the British and Norwegian government, miner Anglo American's (AAL.L) coal unit, diversified miner Exxaro (EXXJ.J), and Xstrata Coal (XTA.L).

SANERI said 60 percent of South Africa's emissions are potentially capturable.

A study to identify the possible storage capacity is expected to be completed by April 2010, with a commercial decision for the demonstration plant to be made by 2016.

http://www.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUSLR30092820090327

Tata Steel to begin production in South Africa next year
11 Apr 2009, 0948 hrs IST, PTI

KOLKATA: World's sixth largest steel producer Tata Steel said it will begin production at Sedibang mine in South Africa from next year.
"A small iron ore mine at Sedibang in South Africa will begin production next year. We would get two million tonnes per annum," Tata Steel managing director B Muthuraman said.
The company is currently focussing on South Africa and Canada and looking at coal blocks in Mozambique, Muthuraman said.
The Sedibang mine has a reserve of 50 million tonnes of iron ore, while the Canadian iron ore mines are likely to have a reserve of 100 million tonne.
"The strategy is to focus at small mines where the investment would be low and large mines where no investment would be needed in next few years," Muthuraman said.
The coal block in Mozambique, in which Tata Steel has 35% stake, is under exploratory stage and the reserve is pegged at 2.1 billion tonne.
Meanwhile, Tata Steel MD said the company is in discussion with Tata Motors to supply flat steel products for the world's cheapest car 'Nano'.

::

Unions question jobless rateUnion leaders have questioned government statisticians about the official unemployment rate, describing the numbers as 'baffling'.
Union leaders questioned government statisticians about the official unemployment rate at a seminar on Thursday, describing the numbers as "baffling".
"Is this a political football? ... It continues to baffle us," National Labour and Economic Development Initiative (Naledi) executive director Rudi Dicks said.
StatsSA was briefing Naledi, a research institution sponsored by the Congress of SA Trade Unions, on the latest unemployment data.
It stated that the jobless rate was down to 21.9% in the fourth quarter of 2008. Kefiloe Masiteng, deputy director-general of Population and Social Statistics, said researchers themselves were surprised at the results.
"We had looked at the results ... We were surprised ourselves," she said. This was one of the reasons why the release of the data in March was delayed by a week.
But Masiteng said the fourth quarter results did not reflect retrenchments made in that period.
"It was very clear that the first quarter of 2009 might start to show the effect," Masiteng said.

Only 21.9%, that would be super if true, knowing that countries such as Spain have 18.4%

Only 21.9%, that would be super if true, knowing that countries such as Spain have 18.4%

But it really is about 40% in SA when you count the one's that gave up and stop looking.

I would say with South Africa's massive informal 'second' economy, real unemployment is lower that 21%...this 40% rubbish that people throw about like its a fact is just that - rubbish!

Why is it that people take other countries at face value with their jobs stats, but for SA there is always rumour, and thats all it is, that something nefarious is happening?

Here in oz, there are millions of part time jobs, and I mean small potato jobs, that they count as 'employed' - we go, ok, look how good they are doing.
Over in SA, they say 21% unemployed, and we go, pphhh rubbish its 40%! Whats up with that?

While we are on stats, note that oz and nz and other western nations dont count 'youth crime' in their stats. That is, under 18's. Just simply not counted, even if its murder, which it often is - crime committed by dissaffected youth over here is high, drug related mostly - convenient hey?

Many more people are going bankrupt
DEBT summonses soared in February while wholesale trade plunged a record 8,9%, adding to the raft of dismal economic data seen so far this year.

Sound regulations have helped the financial sector, the economy’s biggest, to shrug off the global credit crisis. But bad debts are creeping up as households buckle under high debt costs and falling disposable income.

At the same time more companies are starting to fold, as output plunges in SA’s retail and manufacturing sectors — which together comprise nearly a third of the economy’s output.

Wholesale trade fell 8,9% in February compared with the same month last year, the steepest since the latest records began in 2003.

That followed a drop of 3,8% in January, also at constant prices, which are adjusted to account for inflation. In nominal terms they fell 2,3%, the first unadjusted drop on record.

“Wholesale trade outperformed its retail counterpart during 2007 and 2008, but this trend reversed during January this year,” said Fanie Joubert, an economist at Efficient Research.

“What is evident is that both wholesale and retail trade sales are cooling as demand in the economy remains dampened,” he said.

Retail sales plunged 4,5% in the same month, which was also a record. Food, beverages and tobacco and machinery, equipment and supplies were the only wholesale industries to clock up significant growth last month.

Lower fuel and metal prices led to steep falls in those industries while construction and other building materials dived 17%, the data showed.

Other figures yesterday showed summonses issued for debt climbed 14,4% in February compared with the same month last year. In the three months to end-February they rose 15,4%. That suggests personal bankruptcies kept rising that month after a 40% jump in January.

Household debt as a ratio of disposable income declined from a record 78,5% in the first quarter of last year, but debt costs are still at decade highs, above 11% of disposable income.

Most analysts believe SA’s economy has contracted for the second quarter running, which means it is technically in recession.

But ETM managing director George Glynos is more upbeat, with a forecast that a recovery in the second half of this year will lead to growth in overall output. “I think 2009 will be a turnaround year. We see quantifiable signs of an improvement in a number of sectors starting with the consumer.”

Interest rates have fallen 2,5 percentage points since December, and further cuts are expected.

Investors eye SA cabinet: Nomura
April 25, 2009

By Evan Pickworth

As the SA election result draws nearer, investors' thoughts are turning towards the issue of the appointment of the new cabinet in South Africa, according to a senior emerging markets economist.

"We are looking for evidence that Jacob Zuma is appointing people on merit rather than patronage, and equally what happens with the appointment of the deputy finance minister and if someone will be put there to be groomed to take over from Manuel in a year or so," says Peter Montalto from Japanese bank Nomura.

This comes as the ANC looks set to get somewhere around the key two-thirds level.

"However, while voting was skewed away from the ANC earlier on, we now believe that it has gone the other way with a large number of votes coming in from ANC strongholds most recently.

"It is going to be a very close-run thing and it is not a done deal that they will get over two-thirds," he notes.

Montalto says that markets are not reacting to the news, with people unwilling to trade the results.

However, he puts the move in markets more down to central bank chief economist Monde Mnyande's comments on Thursday evening.

Mnyande said at a Wits Business School lecture that he does not see a change in overall macroeconomic policy in South Africa under the new government.

He also said the current "troubled times" should be viewed as a "passing phase".

Although South Africa's leading economic indicator has increased somewhat, the trend still points to a continued slowdown in aggregate economic activity this year.

But Mnyande added that the economy would move to a long-term positive growth curve in the near term.

"Investors are jittery about the two-third level but we believe it is mainly psychological.

"In reality it does not make much difference to economy or market related policy at all. Investors' concerns are more resulting from the recent noise about the Zuma charges and associated issues of corruption," says Montalto.

He says one of the key issues is going to be how the ANC treats the DA in the Western Cape.

"There is a bill under consideration which could claw back power from local government to the centre.

"Investors are looking at what this could mean. Though the ANC says it is only to wrest power from authorities that are not delivering, we remain cautiously sceptical on this issue and wait and see."

"As we have said before: we buy the ANC's line that there will not be any dramatic change in policy, however we are still cautious over the effect policy will have on the productive areas of the economy," concludes Montalto.

Does anyone know what that bill is????

Cabinet approves Constitutional amendment
By: Sapa
Published: 16 Apr 09

Cabinet has approved a draft Constitution change that would give national government wide powers to intervene at local level, prompting opposition protest that the African National Congress (ANC) is seeking a stranglehold on all local authorities.

Government spokesperson Themba Maseko told a media briefing on Thursday that the seventeenth Constitutional Amendment Bill would now be gazetted for public comment before being submitted to Parliament.

He said the main aim of the amendment was to make sure national policy was properly implemented to boost service delivery.

"This Bill vests national government with new powers of intervention at local government level to facilitate service delivery and to achieve regional efficiencies and economies of scale at local government level.

"The Bill will also facilitate the restructuring of the electricity distribution industry and possible regionalisation of other municipal functions when necessary," he said.

Maseko said certain municipalities had defied government policy to plough energy revenue back into electricity infrastructure and these should be brought into line.

He declined, however, to name the offending local governments.

"I do not want headlines saying government is attacking any particular city because that draws me into a political debate with an election coming."

Asked why the proposed amendment did not limit itself to letting central government intervene on electricity, Maseko said the State might later need greater powers in other areas and did not want to change the Constitution constantly.

"We don't want to amend the Constitution on an almost annual basis. If we did, it would stop providing certainty. So we thought it was better to give government the powers and trust... it will not use the powers willy-nilly."

The Bill has become a major election issue, with the Democratic Alliance (DA) lambasting it as "clear proof that the ANC wants to change the Constitution to entrench its power".

DA leader and Cape Town mayor Helen Zille called on voters to deny the ruling party a two-thirds majority, which would mean it could no longer change the Constitution single-handedly.

"That is why it is so important to keep the ANC below the two-thirds majority it needs to pass the Bill to change the Constitution. If voters give the ANC a two-thirds majority, the ANC will destroy the capacity of other parties to deliver where they govern."

Zille, who is running for the post of premier of the Western Cape, has repeatedly said the DA wants to claim control of as many local governments as possible over the next five years.

It is part of a strategy to prove to voters that it is better at delivery than the ANC and increase its national vote share in 2014.

Since the DA revealed at the weekend that the Bill was in the pipeline, the ANC has repeatedly said it had no intention of diminishing the Constitutional powers of local government.

"In fact, the ANC is determined that local government should be better empowered and have greater capacity so that it can respond to the needs of the people," party spokesperson Jessie Duarte said.

Zille accused the ANC of lying to the electorate "baldly and blatantly".

Earlier this week, the South African Local Government Association said the proposed amendment was a bid by government to speed up plans to create six regional electricity distributors and remove delivery deadlocks.

It added that while it was still debating its position with members, it was not in favour of an amendment that would lead to "an outright removal of the municipalities' executive authority over electricity reticulation" as this would have severe financial implications for local governments.

But wait.... ANC DOESN'T HAVE THEIR TWO THIRDS MAJORITY TO CHANGE THE CONSTITUTION ANYMORE!!!!!!!!!!! :banana::cheers:

MUHAHAHA! :cheers:

ANC, DA, COPE, whoever, I don't not want any party to have 2/3 majority, or the ability to change the constitution.
*Mr Zuma will announce his new cabinet soon, possibly removing Trevor Manual as Finance Minister, and placing him on a new "planning" board.

Will be interesting to see who the new finance minister will be. It's quite a volatile time to be choosing one.

I think it will be wise for Umsholozi to move Trevor to Planning Dept and have Cyril as Finance Minister.

Planning Dept will definately need someone who knows what it means when talking about delivery and that's definately Trevor.

Imagine Trevor as president, i think he would do a good job

Cyril as finance minister??? hmmmmmm.....im not sure about that one, sure hes good businessmen but a minister of finance... i would pay a million bucks to see the gov turning this search into a reality show.... a mix between the apprentice, survivor, amazing race and wipeout (http://www.youtube.com/watch?v=Uz0bGPoZ75A&feature=PlayList&p=93D7543771A6ACF2&index=10)

Cyril as finance minister??? hmmmmmm.....im not sure about that one, sure hes good businessmen but a minister of finance... i would pay a million bucks to see the gov turning this search into a reality show.... a mix between the apprentice, survivor, amazing race and wipeout (http://www.youtube.com/watch?v=Uz0bGPoZ75A&feature=PlayList&p=93D7543771A6ACF2&index=10)

Same things were said when Trevor took over, wasn't he a civil engineering technician by training or something like that? proves that you simply need to understand how market economics and politics works and be pragmatic about how to achieve lasting economic growth.

SA revenue head could succeed Manuel

Pravin Gordhan, head of South Africa's tax authority, is the frontrunner to succeed Finance Minister Trevor Manuel if he is moved to another post in the new government, a local newspaper reported on Wednesday.

Business Day, citing unnamed sources in the ruling African National Congress, said the party met with its leftist allies on Tuesday to discuss the makeup of the new cabinet under Jacob Zuma, who will be inaugurated as president on May 9.

It said Manuel would either remain Finance Minister as a stopgap measure for two years or become head of a planning commission charged with coordinating policy implementation.

The ANC's trade union and Communist Party allies are understood to oppose Manuel getting either post, said Business Day.

Manuel's fate is crucial for investors. The rand fell 2,5% last year on reports that he had resigned but recovered quickly when he made clear he would stay on.

Analysts warn a move from the finance ministry by Manuel may disappoint markets seeking continuity amid a global economic crisis that looks to have pushed Africa's biggest economy into its first recession in 17 years.

Investors also worry that Zuma will give in to pressure from ANC allies to spend more to help the poor and create jobs as payback for helping him rise to the presidency.

Manuel, widely respected by markets for tight control over spending and for instilling financial stability, has been in the position since 1996.

He has built up a strong team at the Treasury and presided over South Africa's longest-ever growth period - a decade until the fourth quarter of 2008.

http://engineeringnews.co.za/article/sa-revenue-head-could-succeed-manuel---report-2009-04-29

Imagine Trevor as president, i think he would do a good job

apart from the fact that he unashamably still supports the all blacks and not the boks

and has something against the Dalai Lama

You never know what team they really support. As president, he would have to support the springboks (my team) in the public eye, but when he is at home, he could easily support another team, its not that hard.
The Dalai Lama is another issue on its own.

And not a good issue.

He does not have the final say about whether the Dalai Lama can come to SA or not.
*The decision to not grant the Dalai Lama access to South Africa was a decision made by the South African Government, not Mr Manuel

Lol? I think you're a little confusing as to what we're arguing here.

No if you just read you should be able to understand

*facepalm*

I cant wait to see how the financial indicators play out tomorrow.
Such an eventful weekend especially with a new finance minister

Having taken a look through a few of the UK Sunday Papers, it would apear that even this event has passed under the radar. Huge shit storm over here caused by a leaking of Members of Parliment expenses and Brown's snowballing popularity. As a result JZ's bash got a small mention on page 30. Everyone join me in a temporary mopping of our collective brow ;p

ok good, The inauguration was shown live on sky news. Did notice it was not given the "spotlight" due to issues surrounding you own government

TOURISM directly contributed 3% to gross domestic product (GDP) and employed more than 500000 people in 2005, the inaugural Tourism Satellite Account, launched at this year’s Tourism Indaba in Durban, shows.

The launch of the Tourism Satellite Account has been long awaited as until now tourism has not been separately counted in the GDP figures which are released quarterly. The satellite account is a United Nations (UN) World Travel Organisation-approved tool that measures the full effect of tourism on the country’s economy. Currently tourism, which cuts across many sectors of the economy, is estimated to have an overall contribution of about 8,4% of GDP.

Didi Moyle, acting CEO of SA Tourism, welcomed the launch of the satellite account, saying that this is the first step and provided a base year from which later reports would flow. The next report is expected in two to three years. “This will allow us to measure our global competitiveness, which we have never been able to do before,” said Moyle.

Economist Iraj Abedian, CEO of Pan African Capital, said the project had been seven years in the planning and was important in measuring the full effect of the tourism sector. However, he said it was vital that subsequent reports were more up to date and issued regularly.

He said that it clearly showed the importance of the sector. “Mining contributed a direct 5,5% to the economy and tourism is not far behind. While the mining sector’s importance is waning, tourism is growing,” said Abedian. He said based on the report , tourism’s direct contribution was about 3,5% last year.

Key contributors to tourism were accommodation at 22%, and road transport at 20%. Air transport only contributed about 11% and food and beverage consumption a mere 1,8%.

The 2010 Soccer World Cup was the focus of this year’s Tourism Indaba and took centre stage at this year’s Global Media Faceoff, moderated by CNN’s Richard Quest, where Local Organising Committee CEO Danny Jordaan, assured delegates that the country was ready for 2010. The issue of security and readiness of the country’s transport systems was key among the issues raised by the visiting media contingent.

Jordaan also announced Mauritus would become a major accommodation partner and base for visiting fans, with more than 3200 rooms secured for next year’s World Cup. Fans based on the island would be flown in for any of the games they were attending before returning to Mauritius.

SA Tourism (SAT) also launched its official 2010 marketing campaign which went live at the weekend on international television channels including CNN, BBC World, Sky News and Eurosport. Acting CEO of SAT said the campaign would reach 600-million people between now and the kick-off of the World Cup in SA. The campaign includes a 2010 website.

SAT chairman Jabu Mabuza told delegates at the official opening of Indaba 2009 that SA still expected 300 000 visitors in SA despite the weak economy.

Looking back to beginning of time
Kelvin Kemm
22 May 2009 at 06h00

How many people know of the big KAT of the Karoo? Not many, because this sleek giant is a major astronomical telescope, which has been developed locally.

The MeerKAT, a giant astronomical eye on the sky, is part of an endeavour to see the start of time. And there is big money involved, billions of rands.

The telescope concept was initially named the Karoo Array Telescope (KAT). Such a telescope monitors radio waves rather than light.

More
People are used to seeing astronomical pictures created from light images, but few realise that astronomers can generate accurate "pictures" built up from radio waves. The waves that astronomers want to view have been travelling through space since the birth of the universe, so when they get a "snapshot" of these waves, scientists will actually see a picture that was created at the beginning of time.

Major astronomical events, such as exploding stars, do not ONLY emit light, they emit energy covering the entire electromagnetic spectrum, including radio waves, X-rays and gamma rays. Radio waves travel much further, with less disturbance, than does light. So to see back to the beginning of time, it is best to use radio waves.

An array telescope is constructed from a group of individual radio dish receivers, all electrically interconnected. All the individual dishes, interconnected in this way, act as one single telescope with a large collecting area.

The initial South African KAT design team was putting planning blocks in place when team members concluded that they wanted to expand the original concept extensively, by adding more dishes, so the expanded project became MeerKAT. This expanded project will consist of 80 or more dishes. Each radio dish unit will consist of a three-storey-high assembly supporting a 12m diameter dish.

Out of the way

Foundations for the first dishes are now being poured at the 14 000ha site 100km from Carnarvon in the Northern Cape. This remote site has been chosen because there is nothing much there: most importantly, no stray radio waves to interfere with the operation of the telescope. Recent legislation also enables astronomers to ensure that no future unwanted radio waves impinge on the area.

South Africa also has its eye on an even larger international project, the Square Kilometre Array (SKA). This radio telescope array will have a collecting area of 1km² and a project price tag of R15 billion. There is very big money involved in looking for the beginning of time.

Some years ago, when the international community announced the objectives for the SKA, countries were invited to bid to host the telescope. The two countries still in the running are South Africa and Australia. The winner should be announced in 2011.

Winning the SKA bid will not only bring a large financial input into South Africa, but will bring the country considerable prestige in the challenging fields of science and technology.

Both SKA and MeerKAT are major projects, demanding only the best in terms of the science and technology required to design, construct and operate the facilities. South Africans are considered world leaders in this respect.

The project now under construction is known as KAT 7. It will install the first seven dishes of MeerKAT, to become operational this year, with the full 80 dishes expected to be up by 2012. An experimental demonstration model dish assembly has already been built at the Hartebeeshoek Radio Astronomy Observatory near Pretoria.

Building KAT 7 is not just a case of building the seven complex dish assemblies. These seven, and eventually all 80 dishes, have to be interconnected to act as one. This entails developing a system of very high-precision fibreoptic links, integrated into fancy high-speed computing systems. Continuous adjustments and fine-tuning will take place, with scientists tweaking here and there all the time as the final configuration takes shape.

Running MeerKAT will be very similar to operating a Formula One racing car in a Grand Prix, where track or atmospheric changes require rapid expert adjustments.

The fibreoptic cables will be buried, and will undergo extensive testing to ensure that temperature changes in the Karoo do not affect the signal quality.

The South African digital signal processing team can be justly proud of what they have already achieved. The local team has been working with the University of California and the US National Radio Astronomy Laboratory on developing the computing architecture.

They have developed reconfigurable open-architecture computer hardware (Roach) boards. This technology uses very fast hardware to carry out specialised computing applications in parallel.

South Africa is already building Roach boards for India and Australia. The team has also started getting interesting inquiries from the local telecoms industry. So this big science, aimed at looking back in time, will also produce valuable technology for business applications.

Show the world

South African scientists, designers and high-precision construction teams want to show the world what can be achieved in the dramatic dry Karoo.

The SKA is projected to be one hundred times more powerful than MeerKAT. South Africa possesses the skill to build this super system.

The SKA will attract a constant stream of visitors, scientists and astronomers. This has already been demonstrated by the hugely successful Southern African Large Telescope (Salt) at Sutherland.

Salt is the largest optical telescope in the southern hemisphere. It attracts a constant stream of international astronomers and it operates 24 hours a day. It works round the clock because during daylight hours it streams information internationally via the internet. So, in effect, the stars never set on Salt.

The SKA project now involves 55 scientific institutions from 19 countries. It is expected that 40 percent of the cost will be borne by the US, 40 percent shared by eight European countries, and 20 percent contributed by the remaining participants. The South African government has committed R860 million to the SKA effort, including the design and construction of MeerKAT.

The international SKA office is run by the University of Manchester, which operates the famous Jodrell Bank radio observatory in the UK. The South African SKA office is in Rosebank, Johannesburg.

The successful implementation of the KAT 7 phase of MeerKAT will hopefully ensure that the stars of fortune shine on South Africa in the form of the R15bn SKA project.

Who would have thought that the open arid Karoo, where time seems to stand still, could potentially earn so much money from peering back to the origins of the timeless stars?


Kelvin Kemm is an associate at Stratek Business Strategy Consultants

http://www.ioltechnology.co.za/article_page.php?iArticleId=4993666

Very nice!

‘Million-cars’ target key to automotive job creation – Naacam

The South African automotive industry would only be able to create and sustain more jobs if it could achieve a vision of producing one-million cars a year, the National Association of Automobile and Allied Manufacturers (Naacam) reported on Monday.

This was one of the main reasons that Naacam was supporting the second South African Automotive Week (Saaw), an industry showcase and think-tank that was being held in Port Elizabeth during October this year.

Naacam executive director Roger Pitot said that it would not be possible to meet an industry target of 70% local content without much higher production volumes. Hitting the one-million vehicle-a-year mark, would increase employment levels in the auto industry by between 50% and 60%, he added.

Saaw chairperson Alfred da Costa, who has interests in component manufacturing, said Saaw 2009 would be a mix of a four-day industry expo, a “Navigating the Storm: A roadmap to Vision 2020” conference and networking opportunities.

International interest from manufacturers in China, India, Taiwan and Holland showed that the African market was seen as being a potential growth area by the world’s automotive industry, he said. Da Costa urged local component manufacturers to turn this to their advantage by entering into licence agreements with foreign suppliers wanting to enter the African and local South African markets.

Over the next two years, the component industry would be characterised by mergers, takeovers and a consolidation of suppliers by original equipment manufacturers, the Saaw said in a statement on Monday.

The local companies already had the skills, facilities and infrastructure in place, and would benefit from technology.

“Original equipment manufacturers demand that local suppliers have international licensing agreements in place. Therefore, having international links in place is not a choice but a necessity,” said Da Costa.

Saaw is the only industry event supported by both Naacam and the National Association of Automobile Manufacturers of South Africa, together with the Automotive Industry Development Centre.

http://engineeringnews.co.za/article/million-cars-target-key-to-automotive-job-creation-naacam-2009-05-25

An interesting read, I thought:



On the Air 22/05/09


Every Friday morning, SAfm's AMLive's radio anchor Tsepiso Makwetla speaks to Martin Creamer, publishing editor of Engineering News and Mining Weekly. Reported this Friday's At the Coalface Transcript.

Makwetla: Martin, a very good morning to you. South Africa's building industry is scrambling for 'green-building' accreditation, despite the high costs. What exactly is that?

Creamer: Well, green and clean are the buzz-words now. We've got green stars for buildings like we used to have stars for hotels, and we've got the Green Building Council of South Africa and we know that, even at the very top, President Barack Obama siad he was going to bring green buildings into the US and it will have an economic spin-off.

We have a situation similar to that in South Africa, and particularly Australia, with similar climates. We're working together and you can see that we're now looking for green accreditation for buildings. The new Nedbank second phase, going up in Sandton, has already applied for green building accreditation. On the way to the airport, they're looking for a cabon-neutral industrial estate that is going to be built by Growthpoint, and a lot of demand from people coming in from outside South Africa. If you get a corporate company coming in, they want to buy rental space and they want to kow if they building is green. So the pressure is being put on from the outside, and South Africa is responding with everybody fighting to be the first to have the officially recognised green building and obtain the green stars necessary from the Green Building Council of South Africa.


Makwetla: And a single Gauteng diamond has sold for the world record $9-million on world markets.

Creamer: Yes, you can't believe that in our province, in Cullinan mine, about a hundred years ago it supplied the Crown Jewels for the British, and that was at no cost, that was a donation. But a hundred years later, this mine, Cullinan, just outside Pretoria, is still producing gems that can fetch $9-million just for a single stone.

This is a world record price-per-carat at any auction held anywhere. $9,4-million for this seven carat stone found just outside Pretoria at the Cullinan diamond mine and is a great boost for the diamond industry, which is going through a bit of the blues at the moment. This happens to be a blue diamond, a very vivid blue that captured the imagination of the world. We still wonder how much South Africa really makes out of all this because we find the stone, we send it in to the market, and a lot of value is still added outside the country. But nevertheless, it gives a massive boost to the mining industry that is struggling at the moment because they've got a lot of run-of-the-mill diamonds that go into engagement rings and all the rest, but when you find a big stone like that, it gives the mine a massive boost.

This mine is no longer a De Beers mine, but it is now part of Petra, which is listed on Aim, in London.

Makwetla: Speaking of boosts, I see power capacity in the energy-stressed Western Cape has been increased to over 3 000 MW - but very expensively.

Creamer: It is in the Western Cape where load shedding certainly came into play and there were rolling outages and we even had the "bolt-in-the-stator" incident at Koeberg. Now, they can safely say that there's energy security in the Western Cape with more than 3 000 MW, but at what a price.

When you're doing things in an emergency, you do things expensively and they've put in these new open-cycle gas-turbine plants, but they're very thirsty and they drink diesel or expensive fuels and although they can produce these 2 000 additional mega watts plus, they should only be used very sparingly and normally during peak periods.

So it's obviously not the way to do things, when you do things in an emergency, you have to provide this security, and we're still chronically tight on reserve margin in South Africa and the only reason why we've got this breather is because demand has slackened off. If you look at some of the energy-intensive industries, like the ferrochrome industry, 80% of their furnaces are turned off, so they're not drawing electricity, and we're benefiting from that now. But, we should be planning for the upturn to return and that is why it's a little bit disquieting to hear that the new power station that is coming up, the Medupi power station, is about four months behind schedule. It's not a huge number of months at the moment, but it's no good falling behind during this period where we've got an opportunity to come up to speed. But they're still confident that the new Medupi first unit will come in about 2012 and then Kusile to start coming in from 2013 and we have, through restarting all the mothballed power stations, introduced another 4 000 MW of generation into the grid since 2004 and also installed an additional 1 500 km of transmission infrastructure, so we are slowly getting ahead but we should make sure we're ready for the upturn.

Makwetla: And that's your update on heavy industry with Martin Creamer, publishing editor of Engineering News and Mining Weekly. He's back again with us At the Coalface, at the same time next Friday.

http://engineeringnews.co.za/page/multimedia/tab:6