Star 2023-05-11

SOUTH African Reserve Bank (SARB) Governor Lesetja Kganyago has outlined the challenge facing the central bank in fighting inflation with a “very constrained policy toolkit” on the back of rising prices globally, a weaker rand and slow domestic economic growth. Kganyago was delivering a lecture on “Challenges facing the global economy: a South African perspective” at the University of Johannesburg. This comes as SARB is expected to raise its benchmark lending rate by another 25 basis points this month, in a bid to tame persistently elevated consumer inflation. SARB’s hiking cycle has had a crippling effect on the purchasing power of South African households, with more disposable income going to servicing the rising cost of borrowing. Kganyago yesterday said SARB’s Monetary Policy Committee had had to act decisively to prevent…

Big plunge in half-year earnings because of ‘uncertainty of future cash flows’ SHARES in Transaction Capital, the holding company for SA Taxi and used-car firm WeBuyCars, plunged by more than 35% on the JSE yesterday after it reported a worse-than-expected fall in half-year earnings, with analysts saying this was because of uncertainty regarding the group’s future cash flows. The shares later closed the day on the JSE at R7.11. Transaction Capital fell into a massive loss of nearly R1.9 billion in the interim period to end March, retreating off a R615 million profit in the prior year’s contrasting period. This meant the company was skipping a dividend payment to shareholders. Core earnings on a continuing basis for the group amounted to R353m, down 46% on the previous…

SOUTH Africa’s 44 basic basic food items basket as tracked by the Pietermaritzburg Economic Justice and Dignity Group (PMEJDG) had surpassed the R5 000 mark to R5 023.95, way above the around R4 000 minimum wage, programme co-ordinator at the organisation Mervyn Abrahams said yesterday. Consumers are facing the increasing pressure consumers of higher food prices and persistent load shedding, he said. Abrahams said there had been a R481, or 10.6%, year-on-year increase in the current crisis that was largely precipitated by loadshedding. “People are cutting back. The cost of the baskets exceeds the general workers salary and many people cannot afford that in the townships. “This may lead to major health issues when people have to cook a meal for two days, they cannot buy…

SOUTH African lawmakers have hauled Eskom’s top brass over the coals for failing to investigate serious wrongdoing, fraud and corruption at the power utility, following allegations made by former group CEO, André de Ruyter. De Ruyter deposed an affidavit to Parliament last month, formally stating his televised allegations of corruption amounting to R1 billion a month at Eskom by at least four politically connected cartels. Eskom chairperson Mpho Makwana told Parliament’s standing committee on public accounts (Scopa) yesterday, that the board had convened a special meeting with De Ruyter to discuss his shocking allegations and their impact. He said the board was of the view that some of the utterances De Ruyter made had brought the utility into disrepute, and that the board had resolved to agree to the…

JSE LIMITED shareholders have called for the bourse to review the way it conducts its business, and requested it to consider share buybacks for shareholders while listing more companies on the exchange. Speaking at the JSE’s annual general meeting on Tuesday, shareholder Howard Lowenthal said the JSE issuers were complaining about the red tape. “We’ve got a big moat. We don’t need you investing our cash for us. Warren Buffett will tell you that he’s never paid a dividend at Berkshire Hathaway, and they embark on share buybacks, and so do numerous others”, Lowenthal said. “We are appealing to you to review despite all the hard work that goes on here. Quality of earnings. All of these things are vital and required regardless. But R94 on an 8% dividend yield?…

TRADE union Solidarity announced yesterday that it had served a summons on President Cyril Ramaphosa, the Department of Employment and Labour minister Thulas Nxesi, the Director-General of Employment and Labour, and the Employment Equity Commission over the Employment Equity Amendment Bill of 2020. The union said it had taken these steps after the President, earlier this year, signed the amendment bill on employment equity. Solidarity said it disputed the constitutionality of the amendment bill in its court papers. It said it further contends that this law is contrary to international labour conventions and that the government is guilty of being in contempt of such conventions. Solidarity chief executive Dirk Hermann said: “The level at which the government wants to normalise discrimination in the workplace is shocking. The government wants to…