Star 2024-02-12

Finance Minister under pressure to expand social grants, implement national health plan PRESIDENT Cyril Ramaphosa’s State of the Nation Address (Sona) speech last week has put an additional burden on Finance Minister Enoch Godon- gwana’s upcoming Budget speech to make allocations for the expansion of social grants and the controversial health plan. This was the view of a number of analysts who said Ramaphosa had trumped populist policies at the expense of the fiscus during his Sona, in a bid to curry favour with the electorate and secure a second term as the country’s President. Ramaphosa last week said the government would extend it and improve the R350 Social Relief of Distress (SRD) Grant, which currently reaches some 9 million people every month, as the next step towards income…

SASOL’S share price fell hard by 4.1% on Friday after it said interim profit had been hurt by weaker oil and petrochemical prices, unstable product demand and inflation cost pressures. A trading statement by the fuel and chemicals company said adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) was expected to fall between 0% and 18% for the six months to December 31. Adjusted Ebitda was expected to be between R26.2 billion and R29.4bn compared to the prior half’s R32bn. Sasol’s share price traded at R146.21 on Friday afternoon, this after steadily trading lower over 12 months from R278.66 at the same time a year previously. The share closed the day at R146.55, 3.9% lower. “Despite some operational im- provements in South Africa, persistent under-performance of the State-owned…

THE COMPETITION Commission plans to do a market inquiry into the poultry industry value chain, saying it has reason to believe there are features in the poultry market that may impede, distort or restrict competition. This will come as another blow to poultry companies, which only two weeks ago heard that they would face stiffer competition from frozen imports, after the government provided temporary import rebates on frozen poultry. The rebates were granted ostensibly due to a shortage of birds locally, following the culling of 8.5 million chickens last year due to avian flu, and notwithstanding that the industry has disputed there was a shortage that necessitated the import rebates. However, some poultry product prices in some regions, notably for eggs, have increased sharply in the past year due…

THE US RATINGS agency Moody’s down- graded Israel’s credit rating on Friday due to the impact of its ongoing conflict with Hamas in Gaza, lowering it by one notch from A1 to A2. In a statement, Moody’s said it had done so after assessing that “the ongoing military conflict with Hamas, its aftermath and wider consequences materially raise political risk for Israel as well as weaken its executive and legislative institutions and its fiscal strength, for the foreseeable future”. It was the first time Israel had been downgraded, Bloomberg reported. Moody’s also lowered its outlook for Israel’s debt to “negative” due to “the risk of an escalation” with the far more powerful Lebanese militant group Hezbollah that operates along its northern border. Hamas’s unprecedented October 7 attack resulted in…

THE DURBAN Container Terminal (DCT) Pier 2 had maintained single digit numbers of vessels at anchor, having increased operational teams to 11 per shift on the waterside handling, Durban Terminals said in a statement on Friday. The combination of employee allocations and evacuation of import containers averaging 35 wagons daily, via rail to back-of-port facilities, had also enabled fluidity on the landside handling. The interventions had resulted in significant improvements and considerable decongestion of the terminal. “At the height of the vessel backlog in November, DCT Pier 2 had 43 491 import containers waiting at anchor, and has since reduced that number to 1 738,” it said. Managing executive at the Durban Terminals, Earle Peters, said there were ongoing positive engagements with shipping lines and transporters. “We…

WITH SOUTH African President Cyril Ramaphosa’s State of the Nation Address (Sona) leaving the financial markets with more questions than answers, and many of the country’s structural risks remaining unsolved, the markets should brace for continued volatility in the lead-up to the National Budget Speech on February 21 and continue to hedge against risk. The president spoke about key issues facing the country, but fell short on explaining how these issues would be addressed. The recurring sentiment of promises around delivery without a clear implementation plan has resulted in markets becoming disinterested in Sona. The rand barely moved in response to Sona. Sona to Sona There have been no major shifts in economic policy, comparing Sona 2023 to Sona 2024. High economic uncertainty re- mains, and was in fact exacerbated…