Star 2024-09-10

THE RAND BEGAN the week on the back foot as it struggled to find direction, weakening 0.6% to R17.95 against the US dollar in early morning trade before trying to claw back some losses to R17.85/$1 at 6pm. This comes as the rand, which had initially firmed to R17.60 levels in the wake of the US payrolls data, closed softer on Friday at R17.85/$1 after the greenback recovered later in the New York trading session. Traders yesterday said they expected the trend of the weakness in the rand to continue for now as US jobs data disappointed. The key US labour market data release showed the non-farm payrolls figure was revised down to 89 000 in July, from 114 000, a very weak outcome which added to market…

THE AGRICULTURAL sector can breathe a bit easier as the Land Bank is set to emerge from a four-year debt default position after its debtors had agreed to a “landmark” debt restructuring solution. Following the signing of legal agreements and the fulfilment of all conditions, the debt restructuring solution would take effect on September 16, 2024, ending the Land Bank’s debt default position, the State-owned entity said yesterday. South Africa’s biggest lender to farmers first encountered liquidity challenges in April 2020 and missed a restructuring deadline in March 2021. It currently has R4 billion equity in hand. Scheduled repayments to lenders would occur every six months until March 2028. “This debt restructuring spans multiple financial instruments of all the bank’s lenders, ensuring equitable treatment of all the lenders, regardless…

THE COMPETITION Commission chief economist and acting deputy commissioner, James Hodge, came under fire at the Competition Tribunal yesterday for allegedly picking and choosing facts that suited the commission. Hodge was being cross-examined during hearings as to whether a merger be allowed to go ahead through the combination of Vumatel and Dark Fiber Africa, which Vodacom will buy from Remgro, to create Maziv, which would be the largest fibre infrastructure player in South Africa. The commission has slammed the proposed merger as being anticompetitive and having the potential to create a pivotal shift in the telecoms sector, taking the industry backwards. In addition, concerns have been raised that Vodacom will have main con- trol over the merged company, even though it will only own between 30% and 40%, because it…

TRANSNET is set to get a R140 million shot in the arm from the about R630m grant funding announced by the EU Commissioner for Energy, Kadri Simson, towards building up South Africa’s green hydrogen production capabilities, as the EU spreads its sources of clean energy to support the market, which currently consumes 10 million tons of clean energy a year. This comes as the EU yesterday announced two grants with a sum of R633.4m (€32m) in support of South Africa’s green hydrogen agenda. At a briefing on the announcement alongside the Department of Electricity and Energy as well as the Department of Trade, Industry and Competition (dtic) yesterday, it was said that a R490m tranche was expected to leverage R10 billion in private and public sector…

STARTING on September 1, South Africa’s new “two-pot” retirement system is in effect. The system is designed to ensure that South African workers can deal with emergencies, such as the sudden loss of a job, while preserving at least some of their retirement savings. It’s a fairly unique system and is designed specifically for a South African context where traditional saving rates are incredibly low and where, according to our 10X Retirement Reality Report, 56% of working people changing jobs admitted to cashing in their retirement savings. There’s also an unfortunate tendency for people to resign from jobs just so they can access their retirement savings. The two-pot system changes that. Rather than being able to withdraw the entirety of their savings, people contributing to retirement funds will be allowed…

AS IMPACT investing becomes increasingly important for capital allocators globally, it is time South Africa steps out of the shadows to attract foreign investments. During the 9th Annual Meeting of the New Development Bank (NDB), which took place in Cape Town last week, the bank approved a R5 billion loan to Transnet in support of the freight rail sector. This loan adds to the $5.8bn of loans granted to South Africa over the past five years to State-owned entities in support of projects like battery storage, gas emissions, toll roads and water supply programmes. The government is the custodian of the bulk of infrastructure development, but it is not the only investor in this category, many private investors could benefit from this funding. While the amount is significant, it…