Republican Reference - Area (sq.km) 1,219,090 - Population 49,004,031 - Capital Pretoria - Currency rand - President Jacob Zuma

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Key Economic Data 
 
  2012 2009 2008 Ranking(2012)
GDP
Millions of US $ 384,300 285,983 276,445 29
         
GNI per capita
 US $ 7,610 5,770 5,820 96
Ranking is given out of 213 nations - (data from the World Bank)

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Background:
The Union of South Africa that followed the Boer War (1899-1902) operated under a policy of apartheid - the separate development of the races. The 1990's brought an end to apartheid politically and ushered in black majority rule. Southern Africa as a whole is a very different place than it was two decades ago. Old single-party dictatorships and white minority government have given way to nascent democratic governments with varying degrees of success and maturity. On 10 May 1994, Nelson Mandela took office as the first president of the 'new' South Africa'. His inauguration marked the end of a long struggle to achieve a non-racial political regime and the beginning of an equally difficult and protracted process of state and nation building that is intended to lead eventually to the realisation of a stable democracy. 
The 1990's can be viewed as a success. The diminution of political violence, the relatively peaceful transfer of power, the continuation of the transformation process, albeit painfully slow, can be regarded with pride and promise. The retirement of Mandela as president in 1999 saw the second round of successful majority-rule elections. The succession process was amazingly smooth. Thabo Mbeki was officially named to ANC's candidate for president back in 1997. Mbeki may lack Mandela's charisma, and his capacity for fairness and sensitivity, but his style is different and more efficient and businesslike. Mbeki will remain unchallenged as president in 2002, but the ANC remains deeply divided.
South Africa is the most developed country in southern Africa, and the regional leader economically and politically. But South Africa (and every other country in the region) has its own problems. The political transition from a race-based polity to one based on majority rule is almost complete, yet subject to tensions. Changes have occurred with relatively little violence. Aside from the former Soviet-bloc countries, no nation has experienced greater change than South Africa over the past decade. The non-racial democracy is still in its infancy and still requires nurture and development. 
South Africa has the most sophisticated economy in black Africa. Unlike other African countries its manufacturing sector is relatively advanced. It is the largest sector of the economy, contributing about a quarter of the GDP. Agriculture is also relatively diversified, producing wine, citrus products and wool for export and maize for internal consumption. Agriculture accounts for about 4 percent of the GDP. The population is growing fast at 2.6% pa. In 1999 it totalled 45 million - 76% African, 13% white, 8.5% coloured, and 2.5% Asian. The GNP per head is over $3000 (compared to $300 in Nigeria) but this figure masks inequitable distribution of wealth between the races.
In Southern Africa as a whole, South Africa accounts for less than one-third of the population but for more than 75 percent of the GDP. Its economy is 3.4 times larger than the combined economies of the other members of the Southern African Development Community - SADC (Angola, Botswana, Lesotho, Malawi, Mauritius, Mozambique, Namibia, Swaziland, Tanzania, Zambia, Zimbabwe). This suggests that South Africa occupies a position in Africa similar to the United States within the global economy. While the United States accounts for 26 percent of global GDP, South Africa accounts for about 44 percent of Africa's GDP. South Africa's economic outreach into and beyond the region grew substantially after the ending of apartheid, and shows every sign of continuing to do so. Many of South Africa's largest conglomerates, banks, and financial institutions have found openings for investment in some twenty countries in Africa. The countries of greatest immediate interest are Angola because of its oil and mineral resources, and the Democratic Republic of the Congo with its huge potential for mining development. 

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Update No: 100 - (26/04/11)

The possibility of a settlement in the 'hate speech case' against Julius Malema was raised during his cross-examination in the High Court in Johannesburg April 21. "If the spirit is the same here certain things... will die a natural death because we appreciate one another. And it doesn't need a court order," said the ANC Youth League president. Afrikaner interest group AfriForum and farmer representatives TAU-SA have taken Malema to the Equality Court over his singing of the lyrics "idhubhula ibhuna", which translate from isiZulu to "shoot the boer". Malema has said he did not recognise the translation from isiZulu as "shoot the boer". He said that the two parties had moved closer. "We are coming very close to each other." Malema was led through questioning on whether he was open to dialogue to solve the matter, which has also sparked a national debate. AfriForum deputy CEO and youth movement leader Ernst Roets has explained that he and the group's supporters find the lyrics threatening, particularly to minorities and with his understanding of the translation of the word "ibhunu", it poses a threat to the safety of Afrikaners and farmers. Malema, who was trained to carry and use a gun by the age of 13, was adamant that this was not the case, adding that the isiZulu word for farmer was "umlimi". He also denied a submission by Du Plessis that the lyrics were part of a greater plan to remove white farmers from their land. Asked whether the ANC Youth League was used by the ANC to get issues like nationalisation of mines going, Malema said that the league had a history of being a radical movement that made older members examine the possibilities of what they suggested. Former president Nelson Mandela had done this and it was not because he was being used by the ANC, but because he believed in what he said.

Zimbabwe President Robert Mugabe distanced himself April 6 from state media's blistering comments on South African President Jacob Zuma, in a bid to end a diplomatic spat between the neighbours. The Zimbabwe government mouthpiece "Sunday Mail" published an editorial calling Zuma "erratic" and "disaster-prone", and had criticised his tough stance on Zimbabwe and his support for the no-fly zone in Libya. "A lot of dire reading has been made out of this week's "Sunday Mail" editorial comment and an opinion piece it carried on the same matter," Mugabe's spokesman George Charamba said in full-page statement printed in the state-run "Herald" newspaper. "The opinion of the Sunday Mail has been conflated with the opinion of the government of Zimbabwe," he said. Mugabe himself lashed out April 1 at the 15-nation Southern African Development Community, after Zuma and other leaders at a security summit slapped him on the wrist over escalating political violence ahead of elections expected later this year. "We are a sovereign country. Even our neighbours cannot dictate to us. We will resist that," Mugabe said. The Sunday Mail went further, with a personal assault on Zuma. The paper described him as a "liability, not only to South Africa, but also to the rest of the continent".

South Africa attended its first BRIC (Brazil, Russian Federation, India, China)summit April 14. Its entry into the BRIC bloc as a full member should boost investment and trade opportunities for the country, as it has done for the other four states comprising the informal grouping. BRIC had a combined GDP of R18 trillion late in December, and will account for 61 percent of global growth in three years time, according to the International Monetary Fund. South Africa's inclusion in the BRIC group of powerful emerging economies has sparked intense debate, with some saying it has done itself a disservice by trying to punch above its weight, and others lauding the inclusion as a step towards becoming a more important player on the global stage. South Africa was formally invited to join Brazil, Russia, India and China as a full member of the group in late December. Significantly, but unsurprisingly, the invitation came from China, which has become the country's largest trading partner. South Africa doggedly lobbied the BRIC Forum in a bid to become a full member. But there has been criticism from some analysts and commentators, particularly as they say South Africa, as a far smaller economy than the other four, will be treated as very much the junior partner.

Back in March, convicted former aide of South Africa's President Jacob Zuma was arrested while out on medical parole. Schabir Shaik, a former financial advisor, was picked up at his Durban home after allegedly attacking a fellow Muslim outside a mosque March 11. It comes after separate allegations by a journalist, who claimed she was slapped by the controversial businessman on a golf course. Shaik's corruption charges nearly cost the president his political career. In 2005, Shaik was sentenced to 15 years for fraud and corruption, including the soliciting of a bribe from an arms company and covering up Mr Zuma's unpaid debts. Two years ago, his release on medical parole sparked controversy because of his high level political connections. Out on parole after serving less than two-and-a-half years of his 15-year-term, one of South Africa's most notorious criminals is back in custody. Shaik was returned to prison after the two separate reports alleged he physically attacked members of the public. Schabir Shaik, whose brother heads up South Africa's intelligence services, was formerly Jacob Zuma's financial advisor. After Shaik's high profile trial, Mr Zuma stepped down as deputy president but he never faced trial himself, and returned to secure victory as South Africa's president in 2009, shortly after which Shaik was released on parole.

South Africa has halted plans by the oil firm Shell to extract natural gas from the Karoo desert by using a method known as "fracking". The process involves pumping pressurised water, sand and chemicals into the ground to extract the gas. The cabinet decided to stop the development until the ecological consequences have been studied. Experts had warned it could put an end to South Africa's bid to host the world's biggest radio telescope. The Square Kilometre Array telescope, a multi-million dollar project which could begin construction in 2016, requires an absence of radio interference, which the fracking may cause. Several government departments will lead the research into whether the semi-arid Karoo region could be damaged by fracking. "Cabinet has made it very clear that clean environment together with all the ecological aspects will not be compromised," said a government spokesperson.

Zuma Says Meeting With Gaddafi Was 'Huge Success'
A 5 strong African Union committee including President Jacob Zuma met with Moammar Gaddafi April 10 to broker peace talks. President Zuma was not present April 11 when the remaining AU leaders travelled to meet rebel leaders. Spokesman Zizi Kodwa said that Zuma did not attend the meeting with the rebels as he was preparing for a trip to China on April 12. President Zuma said the meeting in Tripoli was a "huge success." The AU panel is "very happy with the outcome" of the talks, Zuma said. "Only an inclusive dialogue among the Libyan parties" will ensure a solution to the political crisis, Zuma said. The AU has called for an immediate cease-fire, the opening of channels for humanitarian aid and talks between the rebels and the government. The AU says that Gaddafi endorsed efforts, "including the deployment of an effective and credible monitoring mechanism".

Zuma said that Gaddafi had accepted the AU peace plan designed to end the current conflict. "We also in this communique are making a call on NATO to cease the bombings to allow and to give a cease-fire a chance," Zuma stressed. President Zuma was greeted by pro-Gaddafi supporters in Tripoli carrying banners reading "No to Foreign Intervention," It said Gaddafi has ignored the cease-fire he announced after international airstrikes were authorised, and he rejects rebel demands that he step down.

Despite the AU diplomatic initiative, heavy shelling from troops loyal to the Libyan leader continued on the western fringe of rebel-held Ajdabiya.

Residents there voiced scepticism as to whether the AU mission could put an end to the conflict. "Gaddafi has forced us to go to war for our freedom," said Boubacar Afmen Al Beybani, who fled Ajdabiya for Benghazi two weeks ago.

"In the beginning, Eastern Libya was open to peaceful negotiations, but now it is too late. We will fight until he goes," he said.

Mugabe's Poor Health Dominates SADC Summit Talk
Robert Mugabe arrived at the recent SADC Troika Summit in Livingstone, Zambia with an entourage of over 60 people. For onlookers at the Zambezi Sun Hotel, where Mugabe was staying, there was no doubting the fact that his health is failing - hence the massive security and medical team around him. On arrival at the hotel Mugabe, who was struggling to walk, was helped onto a golf cart which transported him to his room. His bodyguards and other aides followed behind. The same routine was repeated when the ZANU PF leader was leaving the hotel for lunch and the golf cart took him to his car. Various media reports contrasted Mugabe's 60 plus entourage with that of South African President Jacob Zuma, who had less than 12 people around him, and Prime Minister Morgan Tsvangirai who travelled with six people. 4 cabinet ministers from ZANU PF are said to have also accompanied Mugabe, although their role at the Summit was not clear. Dewa Mavhinga, the regional co-ordinator with the Crisis in Zimbabwe Coalition, said he believes that Mugabe's 'physical condition' gave the SADC Troika Summit 'greater impetus to act while Mugabe is around or before it's too late.' Other commentators have made the same point, with some suggesting SADC leaders felt emboldened by Mugabe's poor health to harden their stance on his violent crackdown back home. This year alone Mugabe has flown to Asia three times in three months seeking medical treatment. The official line is that he first went to Singapore in January to have an operation on an eye cataract. After he went back a third time to the same destination for treatment, it was suggested he had a much more serious problem than is being admitted. Mugabe's office has continued to dismiss claims his trips are related to cancer of the prostate gland. He was also forced to deny other reports that he suffered a stroke last year. But those who saw Mugabe in Zambia said his legs were swollen and it was very clear he is far from well, so it suggests there is definitely something more than a cataract problem.

South Africa Launches State-Owned Mining Company
South African President Jacob Zuma has launched a state-owned mining company, called the African Exploration Mining and Finance Corporation (AEMFC). However the move is likely to cause concern amongst international investors, who may view it as a step towards the nationalisation of South Africa's mining industry. Mining is one of South Africa's most important economic sectors. Mr Zuma said the body would bring all state mining interests into its remit. "The role of the state cannot merely be confined to that of a regulator. The state must actively participate in the mining industry to ensure that our national interest is protected and advanced," Mr Zuma said. "Government policy on minerals and mining does not make provision for the nationalisation of mining assets, but it does not prevent the state from participating actively in mining, competing with other companies," he said. Recently South African mining minister Susan Shabangu moved to reassure investors when she said the nationalisation of mines was "not the option." However there has been a debate within the ruling African National Congress party as to whether the country's mining industry should be fully nationalised. The South African Communist Party also supports the nationalisation of mining. "What is worrying for mining investors is, where does it go from here?" said Alison Turner, an analyst with Panmure Gordon. "Is this just a small step to a much broader transfer... to state ownership?" she added. South Africa is a leading producer of precious metals such as gold and platinum as well as a major supplier of coal.

Zuma: will take time to recover lost jobs
South Africa's economy has started to show positive signs of recovery but it will take time to recover from the job losses of a recession in 2009, President Jacob Zuma said April 19. Zuma's administration has vowed to tackle unemployment which stands at about a quarter of the 17 million-strong labour force. Rampant unemployment has kept many blacks in poverty 16 years after the end of apartheid. There has been an increasing number of protests in townships across the country as many poor South Africans demand better living conditions and basic services like water and electricity from the government. South Africans will vote in local government elections in May, and the ruling African National Congress is widely expected to retain control of many municipalities, despite dissatisfaction over jobs. South Africa lost more than a million jobs during its recession in 2009, the first since 1992. "The employment numbers have recently turned positive and the economic forecasts are also positive, both for higher economic growth and for employment creation," Zuma said in a speech at a labour summit with unions. "Nevertheless, it is likely to take longer for us to recover from the job losses of the 2009 recession and to make a real dent in the 24 percent unemployment rate that characterises the labour market." In February's budget, Finance Minister Pravin Gordhan allocated about 20 billion rand towards job-creation projects in line with the government's aim to create about 5 million jobs by 2020. Zuma said achieving that target would mean reducing the unemployment rate to around 15 percent. Zuma rose to the ruling African National Congress's top position with help from the unions, who wanted more leftist policies. He told the unions that the government was committed to addressing labour practises that rob workers of their rights. "We are now taking steps to implement the undertaking we made that we will address the problems of labour broking and regulate out-sourcing and contract work," Some proposed labour regulations, which include increasing benefits to contract workers, have unsettled investors who say the country's labour laws are already restrictive, making it difficult to hire and fire.

Nation Sets to Eradicate Child Labour in Five Years
The Department of Labour has vowed to eliminate the worst forms of child labour in the next five years. Labour Minister Nelisiwe Oliphant made the announcement as she addressed hundreds of people who gathered for the National Child Labour Day commemorations in Stellenbosch April 4. Oliphant spoke against the backdrop of her department's continued drive against child labour, which is backed by various conventions of the International Labour Organisation (ILO). She said South Africa had "progressed considerably" towards the development of a framework to help fight child labour. "Our labour legislation provides the basis for this fight when it outlawed child labour, while it permits certain categories and gives regulations under which this work can be performed. "The newly-promulgated Child Justice Act provides innovative ways in dealing with children who have been involved either in offences where they were used by adults to commit crime or in commercial sexual exploitation," said the minister. Oliphant said with the help of the ILO's time-bound programme towards the elimination of the worst forms of child labour, the department ventured into areas "that may not necessarily be labour-related but with a specific focus on poverty alleviation." The minister acknowledged the role of social partners, including organised agriculture, in fighting the scourge of child labour. Agriculture, according to the Department of Labour, is the largest sector with child labour practices, where most children worked as unpaid family members. She said it was important to allow children to remain children. "This means allowing them to be at school and to play as part of their development." According to the Basic Conditions of Employment Act, it is a criminal offence to employ a child younger than 15 years, except in the performing arts with a permit from the department. A child aged 15 to 18 may not be employed to do work inappropriate for their age, or work that places them at risk. The Act further states that any work performed by a child should not be exploitative, hazardous or otherwise inappropriate for the child's age; detrimental to the child's schooling or to the child's social, physical, mental, spiritual or moral development

Economic Growth Climbs to 4.4% on Manufacturing Expansion
South Africa's economic growth accelerated in the fourth quarter as manufacturing rebounded following the end of a strike by auto workers and interest rates at a 30-year low spurred consumer spending. Gross domestic product expanded an annualised 4.4 percent from the third quarter, when it grew a revised 2.7 percent, the statistics office said in a report released in Pretoria February 22. The median estimate of 21 economists surveyed by Bloomberg was for growth of 4.2 percent. Manufacturing, which accounts for 15 percent of the economy, returned to growth in the final three months of last year as carmakers boosted output after strikes disrupted production in August and September. The Reserve Bank cut its benchmark interest rate three times to 5.5 percent last year to support consumer spending in Africa's biggest economy. "Improving consumption expenditure has supported the strong growth in retail and vehicle sales," Kgotso Radira, an economist at Investec Ltd. in Johannesburg, said. "Going forward, growth in exporting sectors, such as mining and manufacturing, will depend on the pace of global growth and the rand exchange rate." The growth rate is still short of the 7 percent the government says it needs in order to create 5 million jobs by 2020 and slash the unemployment rate to 15 percent. South Africa's jobless rate of 24 percent is the highest of 61 countries tracked by Bloomberg. "The South African recovery has been relatively hesitant," central bank Governor Gill Marcus said on Feb. 4. "However, recent indicators are more positive and suggest that the recovery will be sustained, and we can look forward to more vibrant growth in the coming years. But significant challenges remain." The bank expects growth to average 3.4 percent in 2011 and 3.6 percent in 2012.

Union Sets Wage Bar Way Above Inflation
South Africa's power, iron and steel workers want a 20 percent wage hike this year, suggesting unions will use high world oil and food prices to push for settlements way above inflation. In one of the first salvoes of the wage-negotiating season, the National Union of Metal Workers of South Africa (NUMSA) said April 7 it would strike if it did not get an increase of more than five times the current 3.7 percent inflation rate. "We will have to take industrial action because in this country there is no comprehensive social security net," union Secretary General Irvin Jim told Reuters after the group's annual wage-bargaining conference. Although the final deal will be far below 20 percent, such posturing is likely to stoke concerns about a ballooning state wage bill in Africa's biggest economy and more problems for the government in cutting its budget deficit to below 5 percent of gross domestic product (GDP). The bulk of NUMSA's 200,000 workers are employed in vehicle manufacturing, while 6,000 are employed by the state, via state power utility Eskom. Workers who comprise the bulk of Eskom workforce won a 9 percent wage increase last year after threatening a strike that could have cut electricity during the 2010 soccer World Cup. "Last year unit labour costs in South Africa increased by 10 percent. Labour productivity increased by about three percent, while we lost nearly a million jobs in the past two years," said Dawie Roodt, chief economist at the Efficient Group. "These guys are asking for a 20 percent increase. Do the sums -- they don't add up." Eskom, which employs 6,000 NUMSA members, could not immediately be reached for comment on the wage demands. Other companies likely to be affected by the NUMSA wage demands are Kumba Iron ore and steel-maker ArcelorMittal South Africa. "We think that the 20 percent is justifiable if you look at the levels of indebtedness of our members who are directly affected," the union said. NUMSA, which represents more than 200,000 workers in the auto, steel, engineering and energy sectors, is also demanding an extra 15 percent morning day shift allowance and 20 percent night shift allowance in the metals engineering sector. South Africa's main public sector union has already rejected an initial 4.8 percent wage offer from the government, and other unions are expected to start negotiating pay packages in the next couple of months.

Zuma Signs Companies Amendment Act Into Law
President Jacob Zuma has signed the Companies Amendment Act of 2010 into law and it will come into effect May 1 2011. The Companies Regulations and all other relevant documents will be published and also come into force on 1 May. "The new Companies Act is a major piece of legislation and reform, which has a number of features to it [and] will certainly improve the environment for business operation in South Africa," said Trade and Industry Minister Rob Davies. According to Davies, business as a whole will reap the benefits of the Act. "There is a reduction, particularly on the regulatory burden on small medium micro enterprises. The requirement for financial reporting for small companies has been reduced considerably, in that they do not have to produce audited financial statements, but will need to have financial reporting at an appropriate low level," Davies said. The major innovation is the introduction of a business rescue scheme, which means that instead of companies going into major judicial management as they do now - which is almost invariably a route to an eventual bankruptcy - a rescue process will be initiated. "Creditors can be held at bay while stakeholders work to rescue the company, which is a major and very important innovation," Davies said. The signing of the Companies Amendment Act implies that the Companies and Intellectual Property Commission (CIPC), which was launched by the minister, will be open for business as of May 1 2011. The new Act does not allow registration of Close Corporations (CCs), and therefore none will be registered when the Act comes into legal force. However, CCs that are already in the system will remain active indefinitely, unless they choose to convert into the new corporate regime of the Companies Act of 2008. "The Act does not apply retrospectively and those registrants/people who have already applied for CCs before May 2011 will still receive their certificates," Davies said. The commission will ensure that the regulatory framework for enterprises promotes growth, employment, innovation, stability, good governance, confidence and international competitiveness. The Act also gives the commission powers to investigate companies and to ensure that they comply with the legislation. This includes seizing documents and addressing the burning issue of corporate identity hijacking

Business Confidence Rises in March
The March Business Confidence Index (BCI) rose to its highest level since September at 88.3 points, the South African Chamber of Commerce and Industry (SACCI) said April 5. "The BCI is 5.1 index points higher than a year ago and is at its highest level since September 2008 when the BCI stood at 89.9," said SACCI. Only two of the seven real economic activity sub-indices were positive (retail trade and building activity). "The financial environment remained conducive to a positive business climate in the short-term. Threats to the positive outlook in the financial environment include new risks in the global economic environment, commodity price movements and geo-political instability." Though the BCI improved on a year-to-year basis in March, South Africa's performance in the international trade environment could constrain improvements in business confidence if global competitiveness concerns are not addressed actively. The contributions of the sub-indices on an annualised basis were evenly balanced as six sub-indices were positive and six were negative, while one remained undecided. "Uncertainty gripped the world economy and stock markets and currency markets reacted nervously to the earthquake in Japan on 11 March 2011. Following the initial concern about the impact of the crisis in the world's third largest economy, the consensus appears to be that the longer-term consequences of the disaster for the world economy will be relatively muted," explained SACCI. It said that the Japanese economy will take some time to recover as infrastructure repairs take place. The pace at which the damaged rail and road networks are repaired and at which corporate operations are restored will determine the pace of the Japanese recovery. Additionally, the political turmoil in the Middle East and North Africa, which encompassed a greater number of countries during March 2011, "is of greater immediate concern given the current and potential impact on the crude oil price and the consequences for global inflation," said SACCI. "The domestic economy appears to have regained some momentum in business confidence, but the index remains sensitive to domestic socio-economic developments. The conduct of the local government elections, the decisiveness with which corruption is dealt with and the level of labour dispute activity will be key determinants of whether the BCI breaches the significant level of 90."

Inflation Rises to 4.1 Percent in March
The Consumer Price Index (CPI) rose to 4.1 percent in March - well above market expectations. Statistics South Africa (Stats SA) April 19 released the data showing that CPI was higher in March compared to February's 3.7 percent. Nedbank economist Carmen Altenkirch said: "Consumer inflation accelerated in March, rising well above market expectations. Higher food and petrol prices as well as housing costs were mainly responsible for the 1.2 percent month-on-month rise. The annual increase in education costs, which is surveyed in March, also contributed towards the month-on-month increase." In March, the food and non-alcoholic beverages index increased by 1.2 percent while the alcoholic beverages and tobacco index increased by 3.7 percent between February and March. The clothing and footwear index as well as housing and utilities index and the education index also increased. In the next few months, higher foods and fuel prices are likely to be the dominant factors. "The rand has held up better than anticipated and further rand strength will contain the impact of rising global commodity prices on inflation," said Nedbank, adding that upside risks could stem from a sharper than expected depreciation of the rand, high global food prices, further oil price increases as well as high global food prices. "The upside to our interest rate forecast has increased over the past month, given the persistent surge in food, oil and other commodity prices. The Reserve Bank may opt to react pre-emptively, hiking rates in the second half of the year. However, we believe that this would do little to contain inflation and risks curbing the economic recovery. As a result, the Reserve Bank is only forecast to raise interest rates in January 2012," said the bank. In March, the central bank at its kept rates unchanged at 5.5 percent.

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AUTOMOBILES

South African Vehicle Sales Rise In March
Vehicle sales in South Africa continued to increase strongly in March with a record export performance, data released by an industry body showed April 4. Domestic vehicle sales rose 22.8 percent annually in March, data released by the National Association of Automobile Manufacturers of South. (NAAMSA) showed. Sales of vehicles increased to 53,478 in March from 43,541 in the previous year. Sales of vehicles in the export market surged 37.4 percent to 29,254 from 21,296 last year, representing the highest number of vehicles exported in a single month, NAAMSA said. In 2011, export sales of South Africa-made vehicles are expected to reach 300,000. New car sales advanced 23.5 percent to 35,167 units from 28,464 units in March last year. The strong recovery in sales of new cars over the past 15 months reflected a robust recovery on the consumption side of the South African economy driven by the six and a half percent decline in interest rates since December, 2008, the industry group said. At the same time, sales of new light commercial vehicles, pick-up trucks and minibuses grew by 21.7 percent to 15,736 units in March from 12,927 units in the previous year. In the first quarter of 2011, domestic sales of vehicles increased 22.2 percent over the comparable period in the previous year. The global economy, expected to grow by about 4.5%, and South Africa's growth projected at about 3,5% in 2011, would lend support to domestic and export sales of new motor vehicles, NAAMSA said. "However, rising inflationary pressures mainly as a result of administrative price and increases would combine to put upward pressure on interest rates towards the end of 2011 and into 2012," the association added. "Component and vehicle stock shortages, as a result of the Japanese earthquake and tsunami, could also have a negative, but hopefully temporary impact on domestic sales and exports."

Mercedes-Benz SA's Revenue Rises 23% to R34.7bn
The Mercedes-Benz group of companies in SA said March 15 that it had posted "sterling" financial results, with the group revenue surging 23% to 34.7 billion rand in 2010. This was despite a difficult trading year as the economy was slowly recovering from one of the worst recessions in recent memory, according to the group. Presenting the results in Centurion, Pretoria, Hansgeorg Niefer, CEO of MBSA, said that while the group anticipated an increase in its annual consolidated turnover, it was delighted at the "exceptionally strong surge" in its business. The Mercedes-Benz group of companies in SA incorporates Mercedes-Benz SA (MBSA), Mercedes-Benz Financial Services (MBFS), debis Fleet Management (dFM), Sandown Motor Holdings and Atlantis Foundries. Mercedes-Benz also said it recorded satisfying overall growth in market shares across most sectors of these businesses. "We are most encouraged in that we maintained our leading position in the premium passenger car market," said Niefer. The company said it had achieved a number of milestones in 2010, including a new record production of more than 52,000 Mercedes-Benz C-Class vehicles, despite industry strikes, and the 100,000th locally built C-Class destined for the US market was exported from the East London harbour. In SA, the premium-brand Mercedes-Benz cars achieved more than 16% growth, with a combined total of 22,500 units sold locally. The C-Class grew by more than 10%, with total sales of 13,690 units, while the new-generation E-Class, with total sales of 3,030 units, had its best sales in recent years. In the SUV segment, the M-Class performed exceptionally, with a growth of 27.2% over 2009's sales, while Mercedes-AMG also had an outstanding result, posting a 19% increase in sales. In the extra-heavy segment, MBSA's overall volumes were 9% higher than in 2009 (1,689 compared with 1,550). In the large van segment, MBSA increased market share by 5.5% to more than 50%, and the Mercedes-Benz Sprinter clearly remained the vehicle of choice in this highly competitive segment. The Vito and Viano had a solid performance, owing to the many 2010 FIFA Soccer World Cup orders. The soccer tournament also provided the company with an extraordinarily high bus sales volume and a solid 45% share of the bus market - an increase of 26.7% over 2009. "What was particularly gratifying to see is that the bus retail market maintained its momentum even after the 2010 FIFA Soccer World Cup," Niefer said.

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HEALTHCARE

"We Have a Major Problem" - Head of TB Programme


South Africa has a serious TB epidemic and many patients are not even diagnosed. The country also has the third highest TB burden in the world, says head of SA's TB programme. Dr David Mametja has been the Chief Director for TB Control and Management in the national Department of Health since March 2008. He describes TB as a 'major, major problem'. Quoting estimates by the World Health Organisation (WHO) in 2009, Dr Mametja illustrates how huge the problem of Tuberculosis is in the country. "Our incidence rate, which is the number of people that contract TB on an annual basis the new cases was actually 1% of the South African population. One percent of the South African population is almost 500 000 people in South Africa contracting TB every year. It's a massive number of people", Dr Mametja says. Over the same period of 2009, working on the assumption that about 500 000 South Africans have active TB, facilities were able to screen, test and diagnose just over 400 000 people. This means that many with infectious TB are walking the streets of towns, villages and other neighbour-hoods not knowing that they are sick. "We are under-diagnosing", Dr Mametja admits. "But the good news is that we are seeing improvements in that regard. In 2009 we diagnosed 406 000 cases of TB against a target of about 490 000 in terms of this 1% incidence rate estimate that WHO has given us. It's still not exactly the 490 000, but it's much better than the 380 000 that we diagnosed the previous year; and the figures actually get lower and lower as you go back. I acknowledge the point that we are not detecting as many as we should, but we are seeing an upward trend in terms of the numbers that we are able to detect", he adds. The WHO recommends that countries should strive to reach the gold standard cure rate of 85% for TB. South Africa has been struggling to reach the target over the years. "Our cure rate is about 70% and, then, it varies from province to province. For example, KwaZulu-Natal is under-performing. The cure rates are about 55%, while the Western Cape and Gauteng province are doing very well. They are now at about 80%. So, you can say 70% against 85%... it means we are not doing well. But, then, you have to look at this in a proper context as well. In terms of our strategic plan because we realised that we can't just leap to 85% if four - five years ago we had about 50% - 51%. So, we have to move through properly set targets. In fact, our target for this year we're talking about, which is 2009, was 70% and we have actually reached that target of 70%. So, yes, we are not at 85%, but we are well above the 51% cure rate that we had four - five years ago". Because of the huge burden of TB, South Africa is a member of the international Stop TB partnership. To be a member of the partnership is not an accolade. The 22 member countries are responsible for about 75% - 80% of the world's TB burden. "We are ranked number three after China and India. And that ranking is based on the actual number of people in a country with TB. Now, if you are talking China and India, you are talking of countries with very huge populations. For China, the population is about 1.3 - 1.4 billion and for India it's about 1.2 billion and we are only just under 50 million and we are ranking number three behind those two countries. So, it really demonstrates that we have a major, major TB problem", says Dr Mametja. He says South Africa has attained this status as a result of its slow response to TB. "It's an indictment of sorts in terms of the slow response that we had in the beginning and taking the eye off the TB ball, so to speak", he says. "But some people think that there might have been legitimate reasons. And I don't know whether we are trying to find excuses one of the reasons being that when HIV hit, the focus actually went to HIV - and correctly so. But while we were looking at HIV in terms of raising awareness, in terms of providing resources, we actually ignored TB, and silently, then, the TB problem actually expanded. But, maybe it doesn't matter that much anymore because we have recognised that TB is a problem and the (Health) Minister is very much open about acknowledging that we've got a TB problem on our hands just as we have an HIV problem on our hands", concludes Dr Mametja.

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HIV/AIDS

Testing a Vaccine to Slow HIV

The University of Limpopo Medunsa in April launched a clinical scientific trial to test a vaccine developed in Italy to investigate whether it can slow HIV progression in people already living with the HI-virus. The study is looking to recruit 200 volunteers between the ages of 18 - 45. Participants must be on anti-retroviral therapy with viral loads that are well controlled at about 50 copies per millilitre of blood. The criteria distinctly classify the study as research for a therapeutic intervention against HIV. The candidate vaccine is called TAT. It is a Phase II clinical trial and will investigate the safety of the product and whether it generates an immune response or what is called immunogenicity. Participants are required to take their ARVs when on the study. Professor Maphoshane Nchabeleng, the Principal Investigator in the Medunsa study, says they are investigating what health restorative qualities the candidate vaccine has that ARVs do not possess. Treatment Action Campaign supporters in Cape Town, 13 June 2008. "The main thing is to look at the response of their immune systems. So, we are going to continue taking blood from these participants who have been immunised looking at specific markers in the blood which will reflect the stimulation of the immune system the way we would want it to be stimulated immune response in the form of antibodies. We are going to be looking at the stimulation of specific cells that are known to be immune response cells". Professor Nchabeleng went on to explain why the TAT vaccine is being considered as a possible therapeutic intervention to slow progression of disease associated with HIV infection. "This is a protein that is produced by the virus. It's a very important regulatory protein in the development of the disease. For other diseases we know say measles you and I most probably got measles when we were children and we won't get it again because after being exposed to this disease we get immunised naturally. Our bodies can be able to then protect us against that particular disease". "But HIV has shown to be a very, very difficult disease. Despite the fact that you have developed antibodies, they do not protect you. They do not make you recover from the disease. Instead, your body becomes weaker and weaker and weaker. But it has been found that people whose immunity against this particular TAT protein if that immunity can persist, they tend not to progress in their disease quicker. That is why it was then identified to look at it as a potential vaccine to say: Can we now take this and develop it into a vaccine so that we can immunise people and look at whether if they have developed immunity against it after the vaccination, will it also protect their bodies so that their disease does not progress the very same way as what was discovered in those who naturally continued to have the immunity?" she said. Laboratory examinations will be undertaken to make sure that participants do not have TAT antibodies for enrolment into the study. Early studies involving the TAT vaccine have been conducted in Italy and are still continuing. "In Phase 1 trials in Italy, both preventative trials (in) sero-negative individuals and therapeutic trials in HIV-infected individuals The vaccine was safe and immunogenic. After all the ethical approval we went to a Phase 2 study with individuals on anti-retroviral treatment and we made an interim analysis last summer and it indicates the vaccine is safe and immunogenic", according to Professor Barbara Ensoli, Director of the Italian National AIDS Centre. In scientific terms, the study is defined as a randomised, double-blind placebo-controlled trial. That means that out of the total number of participants half will be given the actual TAT vaccine and the remainder a fake vaccine and none of the people will know; nor will the staff conducting the trial until it finishes and the data is analysed. Professor Nchabeleng warned potential participants that the vaccination, which will be administered through injection over several months over a year, will not replace their ARV treatment. "People should not change what they have been taught because they now think they have received a vaccine. It's a clinical trial", Professor Nchabeleng said

HIV Stalls Progress on MDGs
The HIV/AIDS epidemic is severely hampering South Africa's ability to achieve several Millennium Development Goals (MDGs). Nearly 800 South Africans died every day from AIDS-related illnesses in 2009 and more than 1,110 became newly infected daily, according to the South African Health Review (SAHR) 2010, which reveals the immense challenges in achieving the eight goals set by the UN in 2000. The country has not achieved the goal of universal access to ARV treatment for all those who need it by 2010, despite having by far the largest anti-Retroviral (ARV) treatment programme in the world, and will struggle to achieve the MDG of halting and reversing the spread of HIV and tuberculosis (TB) by 2015. An annual publication compiled by Health Systems Trust, an NGO focused on health systems research, the 2010 edition of the SAHR notes that far from achieving a 75 percent reduction in maternal mortality, the number of deaths resulting from pregnancy or childbirth has actually doubled in the past 20 years. Deaths of children under five have also been rising steadily, reaching a peak of 62 per 1,000 in 2007 and then levelling off, but not declining. HIV is the major cause of the upward trajectory in maternal and child deaths in South Africa. Non-pregnancy related infections, most of them due to AIDS, accounted for nearly 44 percent of maternal mortality between 2005 and 2007, with HIV-positive women nearly 10 times more likely to die during pregnancy or childbirth than HIV-negative women. South Africa recently changed its treatment guidelines to prioritise ARV treatment for HIV-positive pregnant women, a move that is expected to bring down maternal mortality if fully implemented. The SAHR notes, however, that "guidelines do not, by themselves, produce access to essential quality care. Significant weaknesses in already over-stretched ARV services should urgently be addressed in order to ensure that the increased number of eligible pregnant women actually access treatment." The authors add that, even without HIV, South Africa would probably not be on track to meet MDG5 because of the "unacceptably high" rate of deaths due to preventable obstetric causes. Estimates of child mortality in South Africa are based on incomplete and often conflicting data, but it is clear that the HIV/AIDS epidemic reversed gains made before 1990. Looking at data from 2007, the most recent year with reliable figures, the SAHR notes that although the major causes of childhood deaths were neonatal problems, intestinal infections, acute respiratory infections and TB, in many cases the underlying causes of death were HIV, malnutrition and the loss of a mother. The data also revealed marked discrepancies between provinces, with the Western Cape recording 39 under-five deaths per 1,000 and the Free State 110 per 1,000. Besides the MDGs, South Africa's National Strategic Plan includes targets to halve new HIV infections and achieve 80 percent treatment coverage by 2011. Progress on these and the MDGs is difficult to monitor, however, because of the very limited availability of routine surveillance data. "This disconnect between policies, implementation and evaluation is a critical shortcoming in the planning process and a major obstacle in achieving goals," write the authors. South Africa's TB epidemic, the fifth most severe in the world, has further set back efforts to achieve the MDGs. The TB disease burden almost doubled between 2001 and 2006 with an estimated 55 percent of patients co-infected with HIV. In the face of poor cure rates in some provinces, increased levels of multi-drug resistant TB and an over-burdened health system, the TB caseload continues to increase. Since 2009, President Jacob Zuma has announced a number of policies and initiatives aimed at strengthening the government's HIV/AIDS response, including a national HIV counselling and testing campaign and the decentralisation of ARV treatment from doctors prescribing at hospitals to nurses providing the drugs at primary healthcare facilities. The amount of the national health budget allocated to HIV and AIDS has also increased from R4.3 billion (US$627 million) in 2008 to an estimated R5.3 billion ($774 million). HIV incidence rates have dropped slightly but remain high, especially among young women. In rural KwaZulu-Natal, the province with the highest HIV burden, nearly 8 percent of women aged 15 to 49 years become infected per year between 2003 and 2005. Nationally, the HIV incidence rate was estimated at 1.3 percent in 2008. Given the rate of new infections it is not surprising that ARV treatment provision is struggling to keep up. More than one million people have been initiated on ARVs but this still only represents about 60 percent of adults and 38 percent of children who are eligible for the drugs, according to national treatment guidelines. Those guidelines do not reflect the latest recommendations by the World Health Organization (WHO) to initiate all patients at a higher CD4 count of 350 or less. Writing in a local newspaper on 7 December, Rachel Cohen, head of mission in South Africa and Lesotho for international medical NGO, Médecins Sans Frontières (MSF), urged the government to implement the new WHO guidelines and translate the policy of allowing nurses to initiate ARVs into practice. Cohen said South Africa also needed a tender system to enable it to negotiate better prices for ARVs. As well as better monitoring of HIV programmes, the SAHR authors call for each of South Africa's nine provinces to customise their HIV response and for HIV and TB services to be urgently integrated.

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INTERNATIONAL ECONOMIC RELATIONS

South Africa's Unique Values, Economy Will Boost Brics - Zuma
South Africa's unique value system and outlook, as well as its position as Africa's strongest economy, will help boost the Brics grouping, President Jacob Zuma said at the Brics Summit April 14. Zuma was speaking at a joint media briefing at Sanya with the Heads of State of Brazil, Russia, India and China, who all pledged to work together to reform global governance organisations and to improve trade and co-operation. Zuma, who said it was a "great honour" for South Africa to attend today's summit, pointed out that although its Brics' partners were among the leading economies of the world, South Africa had "unique attributes" which would help boost its fellow Brics. "At a political level, our partners appreciate our unique value system which derives from our history and a particular experience," said Zuma. He said its fellow Brics valued the "independent outlook" South Africa contributed to issues related to international peace, security and development As a major player in Africa in the continents financial markets, minerals, industrial and services, infrastructure and electricity generation, South Africa had much to offer. "As you may be aware, our Brics partners are now the largest trading partners of both Africa and South Africa," he said. The fellow Brics nations, he said, realised the exponential growth potential of the regional market. He added that there would be further opportunities with the setting up in a few months time of the Free Trade Agreement between the Southern African Customs Union (Sacu), the Common Market of East and Southern Africa (Comesa) and the East African Community. "It is just natural that our partners will look at South Africa as a springboard into the region and for us to provide guidance on economic development opportunities," he said. He said critical for enhanced co-operation was that the Brics members served on the UN Security Council - either as non-permanent members or permanent members (China and Russia). Brics members would also continue to collaborate through the UN, G20 and the India Brazil, South Africa (Ibsa) forum. The non-aligned movement and Group of 77 would also remain important in furthering South-South relations, he said. There is also a need to reform both the UN Security Council to make it more effective and global financial institutions to promote a "just economic world order". Zuma said South Africa also wants to ensure a legally-binding climate-change agreement, which will govern the world to the increasingly visible effects of climate change. Zuma also briefed fellow Brics Heads of State on AU's peace and security programmes in Africa and the situation in Libya and the AU's Roadmap which he said is designed at assisting Libyans achieve a "lasting peace". Russian President Dmitry Medvedev commended Zuma and the AU's efforts in Libya. He said Russia is "deeply concerned" about the conflict in Libya, particularly with the safety of that country's citizens and pointed out that Russia is not in favour of the use of force, over that of dialogue to resolve the conflict there. Indian Prime Minister Manmohan Singh said he and his fellow Brics heads of state had "greatly benefited from President Zuma's great counselling", while Brazil's President Dilma Rousseff said she was happy to see the attendance of Zuma, which would bring valuable experience from Africa. Rousseff, who congratulated South Africa for being awarded the climate conference in Durban to be hosted later this year, said the countries shared similar views on economic growth and income distribution. She cautioned that the Brics grouping is not organisation set up in opposition to any group of country, but that it worked with other institutions like the IMF. China's President Hu Jintao said the Brics would continue to promote "strong and balanced growth of the world economy". He said the Brics would look to improve relations especially in areas such as business and science and technology and between think tanks of Brics members. Meanwhile, also at today's briefing, Jabu Moleketi, the chairman of the Development Bank of Southern Africa (DBSA) signed an interbank co-operation agreement with his Brics counterparts: Luciano Coutinho, the president of Brazil's development bank BNDES; TCA Ranganathan, the president of India's Exim bank; Vladimir Dmitriev, the chairman of Russia's Vnesheconombank and Gao Jin, the deputy-president of the China Development Bank

Nation Must Proceed Cautiously With BRIC Countries, Say Analysts
South Africa's invitation to join the exclusive Brazil, Russia, India and China (BRIC) grouping has been welcomed by many but some analysts caution that the country needs to tread carefully if it is to avoid being taken advantage of by its much larger fellow BRIC members. South Africa was invited by the BRIC (Brazil, Russian Federation, India, China) to join the grouping in December and for President Jacob Zuma to attend its next summit to be held in Beijing in April. South Africa, which is ranked as the 27th largest economy according to the International Monetary Fund (IMF), is dwarfed by China, the second biggest economy in the world after the US; Brazil the eighth biggest economy; India, which is ranked 11th and Russia the 12th largest economy. . Mzukisi Qobo, who heads the emerging powers programmes at the South African Institute of International Affairs (SAIIA), warns that it is important for the South African government to devise an effective foreign affairs strategy if the country is to benefit from being a BRIC member. He believes that there has been no sign - even in the Department of International Relations and Co-operation's White Paper on Foreign Policy submitted to Cabinet last year - that the South African government has held a serious process to map out how it will contribute to and benefit from being on the informal BRIC forum. But the department stands firm that it has has developed a strategy on how it will relate to other members of BRIC. International Relations Deputy Director-General for Public Diplomacy, Clayson Monyela, says the department has also looked at how it will use its BRIC membership to forge a new foreign policy strategy. The department has also studied a number of key areas that BRIC countries are involved in, including their respective development banks, their role in bilateral meetings and G20 meetings, involvement of civil society and research institutions. A Standard Bank research paper, released in November last year, predicted that the BRIC's share of Africa's total trade would increase from one-fifth to one-third in the next five years, with China making up more than half of all trade with the continent. Some who say China's inroads into Africa may represent a new plundering of Africa might remain sceptical of South Africa's invitation to join the BRIC grouping, arguing it may signal a new run on the country from BRIC member countries. But, Standard Bank chief economist, Goolam Ballim, believes that the move does not represent a new threat of neo-colonialism in Africa. Ballim does, however, caution that South Africa needs to "keep its eyes wide open" when it attends the BRIC summit in April. He says the risk if South Africa did not bargain hard, was that other, more sizeable BRIC members could take advantage of the country and the continent as a whole - all the more so as Africa lacks cohesive partnerships. African countries have to steer away from the perception that BRICS would "lean more sympathetically" to them when it came to trade and economic issues. South Africans have to realise that membership in the BRIC forum will not result in an automatic inflow of billions of rands in foreign direct investment, Ballim warns. He says foreign investors are particularly astute and have a qualified mandate that precludes them from being tripped by the "veneer of BRIC". Despite concern that South Africa could lose out to other BRIC members when it came to trade and investments on the continent, an earlier Standard Bank research paper released in July last year, titled "South Africa: leading or lagging the BRICS' thrust in Africa?" argued that despite increased trade by BRIC countries to Africa - particularly China - South Africa was still in a better position. The report pointed out that South Africa still had historical and logistical advantages over Southern Africa when compared to other BRIC members and that the proposed merger of the Common Market for Eastern and Southern Africa (Comesa), Southern African Development Community (SADC) and East African Community (EAC) trading blocs, would support the country's move to increase regional trade. Building on the benefits of regional integration would remain key to South Africa exacting great benefit from being part of the BRIC club, says emerging markets expert Martyn Davies. Davies, the chief executive of Frontier Advisory, argues that the "S" in "BRICS" should really represent SADC, which had a market of over 250 million people - bigger than that of Russia and Brazil. He says one way to speed up regional integration is to integrate capital markets by, for example, opening the Johannesburg Stock Exchange (JSE) up to include companies in the entire SADC region. He says companies based outside of South Africa stood to benefit from such a move, particularly as 95 percent of portfolio investment inflows on the continent were to the JSE.
Davies dismisses those sceptics that may interpret South Africa's invitation to join the BRIC forum as a bid by its existing members to re-colonialise Africa, adding that more than anything, China's demand for resources had helped at least triple growth on the continent. Similarly, Professor Steven Friedman, director of the Centre for the Study of Democracy, says he was not convinced that China's invitation to South Africa to join the BRIC forum was based solely on an attempt by members to take advantage of Africa. He points out that China and India have demonstrated that they are very capable of forging business links on the continent without the help of South Africa. Added to this was the very "ambivalent attitude" that the rest of the continent held towards South Africa, he explains. "South Africa would gain more from being in BRIC than BRIC members would gain from us," says Friedman. Despite this, he says the other BRIC members still saw a significant benefit in South Africa being a part of the exclusive club. He points out that while the continent has about five percent of the economy, it produced 26 percent of its output. "They want us in, as they see us as an economy with immense potential, given support," says Friedman. Analysts point out that Africa's most populous state, Nigeria, has the potential to pass South Africa's economy soon. A report, "The World in 2050", released in January, predicted Nigeria's growth would average 7.9 percent between 2009 and 2050 - compared to South Africa's 5 percent. Nigerian Ayodele Akanbi, a senior economist at Pan-African Capital, says one could not compare Nigeria with South Africa. He believes Nigeria's economy should be ahead of South Africa's if it were able to "get itself together" but has been hamstrung by poor political leadership and corruption. Akanbi also believes South Africa's invitation to join the BRIC forum was not a precursor to a new colonisation of Africa.

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MINERALS AND METALS

Anglo's Kumba Proposes $7 Billion South African Steel Plant

Kumba Iron Ore Ltd., a unit of Anglo American Plc, proposed that South Africa build a $7 billion plant to make steel slab for export to Asia, helping to cut unemployment and boost growth in Africa's largest economy. The plan would increase the steel industry's contribution to economic output to about 17 billion rand ($2.5 billion) in 2015, from 12.7 billion rand in 2008, and create as many as 3,000 jobs, Kumba said in a report March 28. The plant would export to China, South Korea and Japan, countries with surplus rolling capacity and a shortage of iron ore, a raw material, it said. South African President Jacob Zuma has pledged in the next decade to create 5 million jobs in the country, which has the highest unemployment rate among 60 ranked by Bloomberg. While the government will increase infrastructure spending, business also shares the responsibility of creating work, he said. Kumba said the plant, with an annual capacity of 5 million metric tons, might cost about $6 to $7 billion and be built at a coastal site such as Saldanha, Maputo, Richards Bay, or Coega. "It would require government assistance in terms of financing," Robert Stillman, an economist at Charles River Associates who contributed to the company's report said. "The rate of return could be marginal." The country's steel market is dominated by ArcelorMittal South Africa Ltd., source of about 70 percent of local supply, and the state has for years sought to curb prices. In August, the government said it was concerned that higher prices and a shortage of competition were damaging the economy. Steel Authority of India Ltd., the Asian nation's second- largest steel maker, will consider building a 21 billion-rand plant to rival ArcelorMittal, according to Lazarus Zim, chairman of Afripalm Resources Ltd., the venture's local partner. Zim stepped down as chairman of Kumba in December because of a possible conflict of interest. Kumba had become embroiled in a dispute over prospecting rights at its Sishen mine awarded to Imperial Crown Trading, a company with links to Zim through his relationship with Jagdish Parekh, an Imperial shareholder. Anglo American, based in London, owns about 65 percent of Johannesburg-based Kumba.

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MINING

India's Coal Imports From South Africa Rise 8%

India's imports of coal from South Africa rose 8 percent in the year ending March 2011, accounting for about 32 percent of the African nation's exports, according to data from mjunction Services Ltd. South Africa supplied 20.2 million metric tons of the fuel in the 12 months ending March 2011 to India, up from 18.72 million a year earlier, the Kolkata-based trader said. Imports gained less than expected after rising commodity prices prompted a 17 percent decline in purchases in the January to March quarter, it said. Exports from Richards Bay terminal, Africa's biggest facility for the fuel, were slightly lower at 66.3 million tons in 2010 against 66.6 million tons in 2009, Societe Generale said in a report IN March. Supplies may rise to 72 million tons this year and 75 million in 2012 as the country expands rail links. Indian imports jumped 17 percent to 47 million tons last year, and may gain to 60 million tons in 2011, it said. "China and India will support Atlantic Basin coal," Bank of America Corp.'s Merrill Lynch unit said in a report in February. "India will likely have to import large amounts of coal to feed the expansion in power generation capacity that is currently taking place." India's coal production of 572 million tons is trailing demand, leaving a deficit of 81 million tons, Merrill Lynch said. India's imports of coal from South Africa dropped 40 percent in March from a year earlier to 1.48 million tons because of high prices, mjunction said. Average monthly prices in March rose by 50 percent to $122.57 a ton from a year earlier at Richards Bay, according to IHS McCloskey data. China's imports from South Africa gained 13 percent to 451,391 tons in March while Asia's total purchases increased to 3.69 million tons from 3.5 million in a year-earlier period, mjunction said. Taiwan, Japan and South Korea among buyers making up for slower demand from India. Shipments in March to Atlantic area nations fell by 9 percent to 1.66 million tons from a year earlier, the online trading portal said.

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TELECOMMUNICATIONS

New Cable to Double Broadband Capacity
A new high capacity cable linking South Africa and Europe is set to double the country's current broadband capacity, said Telkom. The much anticipated West Africa Cable System (WACS) linking Southern Africa and Europe arrived at Yzerfontein in the Western Cape April 19. "The 14000km long fibre optic submarine cable system will effectively raise South Africa's current broadband capacity by over 500 Gigabits per second (Gbps). Spanning the west coast of Africa and terminating in the United Kingdom, WACS will enable seamless connectivity into the rest of Europe and America," said Telkom. The four fibre pair system has been under construction since 2009. The total project cost will not exceed $650 million. The cable is an initiative by the WACS Consortium, whose South African members consist of Broadband Infraco, MTN, Telkom SA Ltd, Neotel and Vodacom Group Ltd. The cable also boasts 15 established terminal stations along route and will function to reduce the cost to connect the west coast of Africa into the high-speed global telecommunications network for years to come. It is designed to support present and future Internet, e-commerce, data, video and voice services while also making use of dense wavelengths division multiplexing (DWDM) technology, which enables bi-directional communications over one strand of fiber, as well as the multiplication of capacity. "Its design of 4 fibre pair and 128 wavelength technology make WACS the largest cable system to ever land in Sub Sahara Africa. WACS will meet the demand for capacity well into the 1st quarter of the 21st century," Dr Angus Hay of Neotel, Co-Chair of the WACS Management Committee said. Managing Executive: Telkom Wholesale Services Casper Chihaka said explained that various reasons had led to the choice of Yzerfontein as landing point for WACS and allocating the responsibility to land the cable in South Africa to Telkom. "All submarine cables that enter South Africa is located at either Melkbosstrand or Mtunzini, thus effectively two international fibre gateways. Events such as earthquakes or even a large ship dragging its anchor has seen several cables being cut. South Africa needs a third international fibre gateway to reduce the risk of complete isolation from the rest of the world," said Chihaka. In addition to complementing existing high-bandwidth cable systems in the region, as well as supply first time fibre connectivity to several West African countries, WACS will provide much needed diversity for large volume broadband traffic from South Africa to Europe.

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UNEMPLOYMENT

Govt, Labour Meet On Jobs

President Jacob Zuma opened a jobs summit in Pretoria April 19 by calling on the country's trade unions to help government tackle the issue of unemployment and realise its ambitious target of achieving five million new jobs by 2020. Zuma called the Presidential Labour Summit on Job Creation to rope in South Africa's organised labour movement on government's plans to respond to the unemployment crisis, which was exacerbated by the 2008 global economic meltdown. More than 900 000 South Africans lost their jobs between 2008 and 2009, while some companies continue to cut staff due to rising costs of oil and energy. Last month Zuma held similar discussions with top business leaders during which he outlined response measures to the problem and how government planned to use the New Growth Path to regain the lost jobs and create thousands of new ones. In opening the meeting on Tuesday, Zuma acknowledged that while South Africa's economy experienced strong growth prior to the economic crises that hit world markets, government did not do well in meeting its obligations on jobs and fighting poverty. Among those who attended the summit were a delegation from the country's biggest trade union federation Cosatu, the Federation of Unions of South Africa, (Fedusa) and the National Council of Trade Unions (Natcu) and several Cabinet ministers. Cosatu has been vocal on the issue of labour brokers and its president, Sdumo Dlamini, said they would be raising the matter with Zuma. Discussions were also expected to centre on the New Growth Path and how it will contribute towards the creation of green jobs and the state's interventions in the form of wage subsidies for employed youth and loans for companies in distress. "We have to put our heads together as partners and compatriots to find a solution. We have a good track record already of working together over many years. Social dialogue has been put to the test internationally over the past three years due to the international economic crisis and the challenges that this placed on organised business and labour," Zuma said. He said the issue of mass unemployment in South Africa, especially that of youth, had led to inequality and marginalisation. This was made worse by several structural challenges in the economy that had led to many people being excluded from the country's economic activities. "There is no sharper sign of exclusion than exclusion from the economy. For too many South Africans, this exclusion means struggling alone in poverty and dependency and undermines human dignity." Zuma outlined several interventions which he said had helped South Africa "respond well" to the economic crisis. These include an intensive public investment programme, efforts to cushion the poor through expanding access to social grants, the loans provided by the Industrial Development Co-operation to small business and the training layoffs scheme introduced in 2009 to prevent retrenchments. As a result of the scheme, more than 4 000 jobs were saved between March and September 2009, e said Zuma. The IDC is also expected to roll out a further R25 billion over the next five years for green economic projects from a dedicated green economy fund. The President went on to say that for government to achieve its employment creation targets, it needed to bring many young people into economic activity as well as in long-term employment. He added that the rate of youth unemployment was unacceptably high. Authorities were interested in hearing the views of the trade union movement on how the labour absorption of young people can be increased at a level that will decrease youth unemployment. But Cosatu said the issue of skills and youth unemployment was not the major problem facing the country and blamed structural "deficiencies" in the economy as the cause of unemployment. "Organised labour is ready to partner with government based on the need to create decent jobs but we will not divert from the core issues that stop the economy from being productive, we need a proper framework," said the federation's president. Dlamini said Cosatu took the summit very seriously, as it provided a rare opportunity to discuss issues that affect both the government and the labour movement. "Cosatu is confident that this summit will not just be a talk shop but will be able to find solutions to our problems," he added. Fedusa and Nactu said it was unacceptable that 17 years into democracy, South Africa was still faced with relatively high unemployment figures. They both called on the state to address the wide ranging economic imbalances, poverty and income gap
 

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