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Finweek - English

Finweek - English 7/16/2020

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Finweek is South Africa’s leading financial weekly magazine focusing on investment. With its brisk, creative and authoritative analysis of business and investment issues, it’s an essential business tool in the daily battle for competitive advantage. Today's business decision-makers have to cope with increased pressure on their time and are expected, more than ever before, to succeed in the face of stiffer competition. Finweek provides relevant information in quick bytes, along with award-winning investment advice.

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South Africa
Media 24 Ltd
25 Issues

in this issue

2 min.
from the editor

it never ceases to amaze me that despite countless times of it being made abundantly clear that social media is not a forum for nuanced discussion, another Twitter war erupts because someone decided to make a sweeping (often incendiary) statement in 280 characters, or less. Social media can create a space where ignorance obliterates critical thinking. If wielded as such, it can become an enormously powerful and divisive weapon. Just ask Donald Trump. Or Helen Zille. It’s one of the reasons I’ve never been a particularly active social media user. The cynic in me enjoys those who can construct scathing, witty commentary, but I just as easily dismiss and roll my eyes at the more bizarre rants that I scroll past. Choosing not to engage. Clicking the unfollow button, and not thinking…

5 min.
the paradoxes of pandemics

When a crisis hits, economic historians are in demand. The 2008 financial crisis made students of the Great Depression popular commentators and policy consultants. The swift and correct reaction by the US Federal Reserve was undeniably aided by the fact that its chair at the time, Ben Bernanke, had written his PhD on the 1930s depression and the weak monetary response that exacerbated the crisis. The current global pandemic is no different. Now the historical analogy, of course, is the 1918 Spanish flu, an influenza pandemic that killed an estimated 6% of (or 300 000) South Africans and as many as 50m people globally. Although far less studied by economic historians than the Great Depression, Covid-19 and its global impact have ensured that the research gap is closing quickly. Several dozen…

4 min.
hotly contested township markets

talk of large formal retailers being allowed by government to spread their tentacles into the spaza shop market is splitting the black business community down the middle. Two diametrically opposed views on the thorny subject are beginning to emerge, with one camp supporting a tentative push by white-owned retailers into the spaza shop market and another camp arguing for retailers to be stopped in their tracks before they gobble up the lucrative market straddling South Africa’s townships and rural towns. The issue came under discussion recently at a second instalment of a live Facebook panel discussion, known as Lockdown Convo, which I participated in. The theme of the discussion, moderated by MisoTini, posed this question: What does it mean for black business if Pick n Pay and Shoprite can enter the spaza shop…

4 min.
in brief

“Not much to go around, yet not the right hands at the till.” – Kimi Makwetu, Auditor-General of SA, titled his office’s latest general report on the local government audit outcomes this way. He said this is “to reflect the state of financial management in local government. Billions of funds allocated to municipalities are managed in ways that are contrary to the prescripts and generally recognised accounting disciplines.” The report states that 8% of municipalities received a clean audit, and on average took 180 days to pay creditors. Irregular expenditure exceeded R32bn – up from R24bn in the previous year. “WE’RE COMMITTED TO HELP FIND A SOLUTION IN THE FIGHT AGAINST THIS UNPRECEDENTED GLOBAL PANDEMIC.” – CEO of Cipla South Africa, Paul Miller. The drug manufacturer is set to bring its generic version…

1 min.
double take

THE GOOD South Africa’s telecoms regulator, Icasa, said it is preparing to issue an invitation to apply (ITA) for high-demand spectrum and the Wireless Open Access Network (WOAN), a significant step towards the rollout of 5G across more of the country. Mobile operators MTN, Vodacom and Rain have started rolling out 5G networks in major SA cities using temporary spectrum assigned by the telecoms regulator. Operators’ data costs have come down recently after they were forced to cut data prices, but they still argue that costs could come down significantly once regulators auction the much-needed spectrum. THE BAD SA’s budget deficit is forecast to more than double to 15.7% of GDP in the 2020/2021 financial year, finance minister Tito Mboweni said in his supplementary budget, which came in response to the Covid-19 economic…

4 min.
anglo’s plan to exit thermal coal

anglo American has given itself two to three years to dispense with its South African thermal coal export mines. This is in line with a response to questions at a virtual annual general meeting this year in which Anglo also disclosed that the divestment would be partial; that is, through a demerger with the new company floated on the JSE. However, the intention is to get on with the job in a much shorter timeframe than three years. “Once you’ve made the decision, you’re better off getting on with it and the demerger route was the quickest route from our point of view,” said Mark Cutifani, CEO of Anglo American, in an interview with finweek. According to Cutifani, one benefit of the demerger route is that it cuts down on red tape…