MTBPS) on October 26, 2022 amid challenging global economic conditions. In its World Economic Outlook report released last week, the International Monetary Fund expected 34% of the global economy to contract this year or 2023, up from just under 5% at the beginning of the […]
PoliticsBanyana Banyana focuses priority on matches against top opponents in preparation for next year’s World Cup FIFA next year is even more useful after they received a very difficult draw for the performance Next year . Desiree Ellis’ troops will face Group G in the […]
SportsNew data from recruitment firm Pnet shows most job sectors in South Africa are returning to pre-pandemic hiring levels , with vacancies in most fields. Pnet’s latest Employment Trends Report provides an overview of recruitment and employment trends in the South African market. According to […]
JobsNew data from recruitment firm Pnet shows most job sectors in South Africa are returning to pre-pandemic hiring levels , with vacancies in most fields.
Pnet’s latest Employment Trends Report provides an overview of recruitment and employment trends in the South African market. According to the company, their report is based on online recruitment platform Saongroups, which currently holds an aggregated database of more than 8 million registered users.
Pnet says hiring continued to grow 4% seasonally adjusted from the previous quarter. In annual change, the number of job offers increased by 19%.
The labor market has seen a strong recovery since the pandemic and the resulting economic restrictions in 2020, Pnet said.
Since Q3 2020, hiring activity has increased by 65%. Pnet said the first three quarters of the year showed solid growth in recruitment activity, with the recruitment trend continuing to increase.
Pnet says these jobs in the following industries are in high demand right now:
IT
• Data analyst
• Business analyst
• Project manager
• Software development
• Java development
Sales
• Account manager
• Sales representative
• Sales manager
Finance
• Financial accountant
• Financial manager
• Management accountant
• Bookkeeper
• Internal auditor
• Financial controller
• Debtors clerk
• Credit Controller
• Creditors clerk
Business & Management
• Business development manager
• Operations Manager
• Recruitment Consultant
Region | Main skills in demand |
Gauteng | Building and construction |
Western Cape | Education, training and library professions |
KwaZulu Natal | Finance |
Mpumalanga | Admin, office and support |
Eastern Cape | Business and management, IT and finance |
North West | Business and management, admin, office and support, sales and finance |
Free State | Business and management |
Limpopo | Admin, office and support |
Northern Cape | Finance |
International | Business and management |
Pnet says Gauteng continues to hold a large share of the recruitment activity.
“In the third quarter of 2022, the province’s employment accounted for 54% of the country’s overall labor demand.
During the same period, 21% of SA recruiting activity was in the Western Cape, while 1 in 10 vacancies were based in KwaZulu-Natal, Pnet reported.
Salary
Pnet highlights the market-related (per month) salaries offered in select roles in engineering, sales and management, as well as warehousing and logistics.
Engineering
Business and management
Warehousing and logistics
South Africa’s booming solar industry is currently experiencing a gold rush as Solar installers and product suppliers are rushing to respond to pent-up demand from aspiring homeowners to reinstall solar panels – set up systems to sustain a lifestyle their. However, to meet this growing […]
South Africa’s booming solar industry is currently experiencing a gold rush as Solar installers and product suppliers are rushing to respond to pent-up demand from aspiring homeowners to reinstall solar panels – set up systems to sustain a lifestyle their.
However, to meet this growing demand, serious challenges must first be overcome to meet demand effectively and help South Africans get through the worst year of offloading to date.
This chart published by EskomsePush shows that in September of this year we recorded a total of 1637 hours of offload, after 4 years of an upward trend.
Considering that the total offload period in 2021 is 1153 hours, it is clear that this uptrend is accelerating. This trend will continue in the medium term, leading to a doubling in load over the next five years.
The root cause is that the five oldest coal-fired power plants have been shut down during this time, with relatively little generating capacity being brought online to replace what’s been going on.
Get a solar quote for your home in less than 3 minutes here.
It is clear that Eskom is no longer reliant on stable electricity, leaving business and home owners with no choice but to look for other options to meet their energy needs. One of the most practical and affordable options is to replace Eskom’s supply with solar-powered energy, installing solar cells.
Every solar panel installation is an engineering project that must take into account the unique nuances of the respective home. Solar installers are flooded with RFPs and costs requiring detailed engineering design to simulate the owner’s unique solar energy savings predictions, costs, and finances.
Creating an accurate and reliable solar proposal takes time, and with increasing national demand for these proposals, it quickly becomes an administrative nightmare. .
Join Hohm Energy, which is a fintech solar marketplace specifically designed to effectively expand this demand and deliver precise, detailed recommendations to customers, including installers solar and homeowners.
Tim Ohlsen, CEO of Hohm Energy, explains how this functions to the advantage of the market:
“Hohm is a software company that has built a marketplace and platform to enable the South African solar industry to scale, whilst providing a convenient and trusted service experience for everyone.”
“Hohm’s software uses a homeowners’ unique design parameters of geo-location, orientation and angle of roof to generate a bespoke solar proposal within less than 5 mins.”
“From there we provide a turnkey solution – namely sales, customer management, deployment features and workflows – to help our onboarded solar installers grow their business by servicing solar enquiries and structuring solar finance.”
Going solar is hugely beneficial but is not without cost, and access to the right finance can also come as a challenge with limited, to no choice, for homeowners to finance their solar battery system outside of using their available equity in their bonds.
Nedbank has recently partnered with Hohm Energy to provide a trusted marketplace for homeowners and solar installers to transact across South Africa. MFC, a division of Nedbank, has launched a new, innovative stand-alone solar finance product that resembles that of motor vehicle financing.
This has enabled MFC to offer homeowners convenient solar finance, even if they don’t have a bond or bank with Nedbank. Hohm’s marketplace and software platform enables all the coordination of servicing homeowners through the journey and matching them with vetted solar installers across SA.
“Hohm Energy has become an innovator paving the way for a true solar fusion model that uses software engineering to streamline all stakeholders in a solar project .”
“Nedbank is delighted to partner with Hohm Energy as a hub serving both homeowners and solar installers to bring more confidence and scale to the residential solar industry growing,” said Quintin Greyling of Nedbank MFC.
Hohm Energy is launching a new feature to open its marketplace to solar installers as it seeks to rapidly expand its footprint across South Africa. “We are bringing easy access to residential solar finance to market, enabling all solar installers in our network to bring their own solar projects into the Hohm marketplace for financing” says Ohlsen.
The company has conducted a successful pilot of this solar partner model with a well-known solar technology company and provider, Wetility.
“We are delighted to be a solar provider in the Hohm / Nedbank MFC Finance partnership and we are extremely impressed with the turnaround time, professionalism and commitment to the quality of the offering.”
“Similarly, Wetility are also very focused on customer success and providing quality and compliant hybrid solar hardware, software, and financing solutions and consequently we are pleased to be able to join this unique offering through our partnership with Hohm.” says Vincent Maposa, CEO of Wetility.
In order to participate in Hohm’s marketplace, to access both structured finance for projects originated by solar installers and receive homeowner projects originated by Hohm, solar installers can register here to start the process:
Sign-up to the Hohm marketplace to become a vetted solar installer to service your clients with solar finance.
Hohm Energy is a platinum sponsor of the South African Photovoltaic Industry Association (SAPVIA) PV Greencard initiative and provides quality assurance of solar installations to consumers.
Hohm plays an active role in supporting the solar installation industry by enabling and ensuring a standard of quality, reliable solar installations provided by our network of solar installations. Licensed solar installers.
As a fintech platform and aggregator enabling the entire solar industry, Hohm Energy’s market positioning could not have come at a better time for consumers and installers.
“We are excited to bring this new solar partnership model to market to help local solar installers grow their business,” Ohlsen said. “We are here to serve our homeowners, our financial partners and our network of solar installers using technology, making the entire solar process simple. faster, and more affordable for everyone.”
South Africa and Indonesia will receive $1 billion from the Climate Investment Fund to replace some of their coal-fired power plants with installations renewable energy sources, part of a global effort to reduce planet-warming emissions. Each country’s allocation of $500 million (Rs 9 billion) to […]
NewsSouth Africa and Indonesia will receive $1 billion from the Climate Investment Fund to replace some of their coal-fired power plants with installations renewable energy sources, part of a global effort to reduce planet-warming emissions.
Each country’s allocation of $500 million (Rs 9 billion) to coal-dependent countries will be in the form of “concessional” or low-cost funding, the World Bank-linked fund said on Thursday. Five in a statement. The money will come from CIF’s Coal Accelerator investment program.
In South Africa, this money will be used to close coal-fired power plants and replace them with renewable energy plants and battery storage systems, he said.
In Indonesia, CIF will work with public electricity supplier PT Perusahaan Listrik Negara and private companies to accelerate the closure of a 2,000 MW coal-fired power plant within 5 to 10 years and explore how replace this capacity.
South Africa is the world’s 13th largest greenhouse gas producer, with 45% of its 452 million tons of annual emissions coming from electricity generation. Indonesia is the 10th largest emitter.
Almost all of South Africa’s electricity is produced from coal by power company Eskom Holdings SOC Ltd. and the country suffered frequent power outages.
“Over the next eight years, South Africa needs $60 billion in investments to make the transition” away from coal, said Barbara Creecy, South Africa’s Environment Minister.
The amount allocated is part of a $2.6 billion package being raised by the government from public and private sources to help pay for the clean energy transition, he added. South Africa is also negotiating $8.5 billion in climate finance under an agreement with the United States, United Kingdom, Germany, France and the European Union known as the Partnership for Public Energy Transition
Deputy Minister of State Security Zizi Kodwa says there is no terrorist threat in South Africa, despite numerous reports confirming the mobility of lovers terrorism in this country. The country was placed on high alert on Wednesday after the US Embassy in South Africa issued […]
NewsDeputy Minister of State Security Zizi Kodwa says there is no terrorist threat in South Africa, despite numerous reports confirming the mobility of lovers terrorism in this country.
The country was placed on high alert on Wednesday after the US Embassy in South Africa issued a warning about a possible terrorist attack in Sandton on May 29-30. 10. Although it did not give details, the embassy warned US citizens to stay away from the area and avoid crowds.
Several other embassies in the country, including those from the UK, France, Canada, Germany and Australia, have followed their own warnings to their citizens based on the US warnings. Ky.
.
The South African government’s response has been mixed, with Presidential Palace Minister Mondli Gungubele saying he was unaware of any terrorist threat – and criminal and investigative agencies saying they were investigation into the origin of the allegation.
The President’s official response was that they “take note” of the US warning, but downplayed its severity, saying that “if necessary, the South African government will be the first to notify the public. of any impending threat”.
President Cyril Ramaphosa called the warning “regrettable”, adding that it had caused panic among the population.
Speaking at an event in Pretoria organized by the National Press Club on Thursday night (October 28), Kodwa repeated the official line from the President’s Office that the South African government had not received a diploma. evidence of an impending terrorist attack.
He said the warning had caused a lot of anxiety and panic, but made it clear that “from the point of view of the SSA – the State Security Service – there is no direct terrorist threat to ‘ South Africa”.
He said the US warning broke protocol and could cause a significant diplomatic breakdown between the two countries as it eroded South Africa’s sovereignty and caused panic among the population.
Although he sees no cause for concern, Kodwa said the government will not let its guard down.
High Alert
Businesses in Sandton and the City of Joburg are on high alert following the alert.
As events planned for the weekend continue and businesses in the City of Sandton will remain open and continue as normal, additional precautions are being taken.
Joburg Mayor Mpho Phalatse said the US Consul General in Johannesburg Vincent Spera had contacted her to inform him of the embassy’s detection of a potential attack in the city.
“To ensure that the city is fully informed and prepared for any eventuality, I spoke with the Commissioner of the South African Gauteng Provincial Police Service (SAPS), Lieutenant General Elias Mawela, requesting that all information and all information will be shared with the City,” she said.
” The Provincial Commissioner has assured me that the necessary measures have been taken and nothing will happen. Chief risk advisor at the Institute of Risk Management South Africa (IRMSA) Christopher Palm said whether the terrorist threat materializes or not, companies in the affected area – Sandton – should take the matter seriously.have important conversations about what to do when one situations with the potential for violence and danger e or may become the same.”
Senior Training Coordinator for the Institute for Security Studies ENACT, Willem Els, said the matter This should be treated as a bomb threat. He said: “Even if governments deny the existence of an active threat, they should take the necessary steps to minimize damage and harm.
Els said South Africa has proven it failed to effectively manage security and intelligence threats, which may be why the US Embassy skipped the process to wait for the South Vietnamese government Phi replied.
He said that foreign missions have a duty to take care of their citizens. “We know that some foreign missions have caught on to this – if we (South Africa) receive credible threats in other countries, we will follow the same path.” (issues a warning),” he declared.
Eskom power company says it will need an additional 53,000MW of new generation capacity over the next 10 years to ensure energy security in South Africa. This will require “special measures” to speed up network deployment, he said. The group outlined the situation at the […]
NewsEskom power company says it will need an additional 53,000MW of new generation capacity over the next 10 years to ensure energy security in South Africa. This will require “special measures” to speed up network deployment, he said.
The group outlined the situation at the Transmission Development Plan (TDP) public forum on Thursday, October 27, where they said the additional capacity would focus specifically on renewable energy sources. generation, such as wind and solar power.
This new added capacity of 53,000 MW covers the current deficit of 4,000 MW to 6,000 MW and constitutes a substantial revision of the 2021 PDT, based on the Plan’s new capacity assumptions. Integrated Resources Plan 2019 (PRI2019), is proposed around 30,000 MW of new capacity by 2030.
high-voltage lines and 170 transformers by 2032,” he said.
With long-term uncertainties, the group said that it will focus on implementing projects in the next 5 years. However, this will have a significant cost.
The analysis performed reflects the need for approximately 2,890 km of additional high-voltage lines and 60 transformers, requiring an investment of Rs 72.2 billion by the financial year 2027, he stated.
“In order to carry out network consolidation projects over the next 5 years, we must take special steps to accelerate network deployment. This will certainly require careful planning on our part, as well as alignment, coordination and support from all key stakeholders.” The updated
TDP also takes into account the decline in the energy availability factor (EAF) of Eskom’s coal fleet, which was a key factor in the drafting of IRP2019.
“The additional production capacity requirements also take into account Eskom’s 2035 business strategy and have taken into account the connectivity requests received from various Department of Minerals and Resources procurement programs and Energy (DMRE) and applications receive from non-DMRE integration programs, as well as input from various renewable energy associations.
Adapting to this increased transmit capacity means that a reliable and sufficient transmission network is needed to integrate and distribute this new capacity to load centers across the country.
Eskom’s managing director of transmission, Segomoco Scheppers, says the next five years are critical for supply security.
“If the requirements of TDP 2022 to provide sufficient transmission network capacity by 2027 are met, a substantial investment of Rs 72.2 billion will be required to expand and strengthen the network. transmission network in the next 5 years.
“Of these, Rs 50.8 billion is needed for new capacity expansion projects to meet new generation load and capacity connectivity requirements, and to acquire new capacity device. An additional Rs 21.4 billion is needed to refurbish the existing asset base and purchase production equipment.
Separation
Giving an update on the legal separation of Transmission business as a 100% subsidiary of Eskom, the team said the process is in an advanced stage, with the Transmission
entity already in the process. registered as National Transmission Company South Africa (NTC) SOC Ltd.
“A binding merger agreement has been entered into with precedent conditions that must be met for the efficient transfer of business from Eskom to the Transmission entity. After fulfilling the precedent conditions, the NTC will be put into operation and the employees will be transferred to the company with the same conditions of service without interrupting their years of service.
The application for an electricity license for NTC was returned to the National Energy Administration of South Africa (NERSA) in September 2022 and is under review.
“Eskom relies on governments and lenders to make key claims. The expected start of NTC trading is in the new financial year, provided all precedent conditions are met.
Fuel prices in South Africa are expected to rise next week as the rand remains under pressure and global oil prices remain high. Latest data from the Central Energy Fund (CEF) shows gasoline up 48 cents/litre and diesel up around R1.61/litre as current market conditions […]
Fuel prices in South Africa are expected to rise next week as the rand remains under pressure and global oil prices remain high.
Latest data from the Central Energy Fund (CEF) shows gasoline up 48 cents/litre and diesel up around R1.61/litre as current market conditions continue to put pressure on local prices geography.
According to CEF, the latest fuel price forecast for November is as follows:
Gasoline 93 & 95 will increase 48 cents/litre;
0.05% diesel will increase 1.61 Rand per liter;
Diesel 0.005% will increase 1.64 Rand per liter;
Paraffin will increase by 78 cents per liter.
The fuel price change will go into effect on Wednesday, November 2, with official announcement expected next week.
Domestic fuel prices depend on two main factors: the rand/US dollar exchange rate and fluctuations in world oil prices.
The Bureau for Economic Research (BER) on Monday (24 October) noted that although it weakened modestly week-on-week, the US dollar remained firm, keeping global currencies – including the rand – under pressure.
“Statements from Philadelphia Federal Reserve President Patrick Harker suggested that the US central bank would keep raising interest rates for a while, coupled with lower weekly unemployment claims, bolstered the greenback,” it said.
On Monday, the rand was trading at R18.27 to the dollar, persisting at levels above the R18.00 mark.
The one-month ahead Brent crude futures contract, meanwhile, rose by 2% – despite the announcement of additional releases from the US Strategic Petroleum Reserve to help ease supply constraints, the BER noted.
Both the dollar strength and higher oil prices spell bad news for local fuel costs over the next week.
The Automobile Association said that while final prices may change at the time of official announcement ahead of further changes, they do not expect a reversal and a rally to come.
“While these numbers are subject to change, we do not expect a reversal; prices are expected to increase further in November. For now, it’s just the amount of those increases being put in place,” he said.
The association says diesel is a particular concern. Since diesel is a major input cost in many industries, an increase in the price of the fuel will ultimately hurt consumers as producers shift the increase down.
This is sure to exacerbate the cost-of-living crisis in the country, with food inflation of 11.9% in September, sending households back significantly.
Good news ahead?
While prices are expected to rise in November, the outlook could be better for December and beyond. The BER noted that the US Department of Energy will release 15 million barrels of its strategic reserves for delivery in December.
Meanwhile, President Cyril Ramaphosa said the Kingdom of Saudi Arabia and other countries Other OPEC has made the decision to focus on price stability in managing their oil production.
During recent intense bilateral talks held in Jeddah, Crown Prince Salman bin Abdulaziz Al-Saud briefed Ramaphosa on a number of economic initiatives that the Kingdom of Saudi Arabia is undertaking. including the Kingdom’s intentions to ensure oil price stability.
“Rising oil prices are contributing to higher fuel prices in South Africa, putting additional pressure on small businesses, consumers and households. The burden is heavier on the working class and unbearable on the poor,” the president said.
Ramaphosa says OPEC and Saudi measures can relieve South Africa’s strained economy. Brent
crude is currently trading around $93/barrel, holding below $100
President Cyril Ramaphosa said current regulations on navigating the country only provide for Phase 8 offloading but the government is working on it. Do what you can to never reach that point. In response to a congressional written question and answer last week, the president […]
NewsPresident Cyril Ramaphosa said current regulations on navigating the country only provide for Phase 8 offloading but the government is working on it. Do what you can to never reach that point.
In response to a congressional written question and answer last week, the president said that Eskom’s system operator determines the required phase of offloading at any given time in consultation with the the company’s power generation segment.
“Phase 6 is the highest load reduction to date, and the reduction equates to about 5% of the load in a specific area per stage,” he said. “The industry document on how to do offloading… has now reached stage 8 of the offloading process. Load distribution is done in a controlled manner to ensure the stability of the system nationwide.
South African businesses, analysts, economists and the general public have watched with anxiety as Eskom’s aging fleet of electric trains crumble before their eyes, with 2022 marking the worst year of load declines. the worst on record, and the worst is yet to come.
The fleet is running on the edge of the knife, as evidenced by the loss of only a few generators at power plants leading to increasingly high levels of power outages. Some analysts have predicted that phase 8 offloading could be coming soon.
According to Eskom, level 8 offloading involves removing 8,000 MW from the grid. If capacity problems exceed this, the system operator will decide specifically, by province, how much power to add.
On Sunday 23 October, Eskom announced that the reductions will continue in phases 3 and 4 until at least Wednesday – with more offloading in phases 3 and 2 planned until the weekend.
Ramaphosa said plans and developments are underway to alleviate the power crisis. He stated: “Since the announcement of additional measures on July 25, 2022 to combat the load reduction, the National Energy Crisis Committee (NECOM) has been established to oversee the measures. to improve the efficiency of Eskom’s existing power plant fleet”.
The Department of Mineral Resources and Energy (DMRE) has announced amendments to Annex 2 of the Electricity Regulatory Act for public comment along with the President’s announcement of removing the authorization threshold for power plants. composite production project. The previous timetable was revised to raise the authorization threshold to 100 MW, a reform that has unlocked significant private investment. The new amendment will remove the licensing requirement for power generation projects of any size and allow investments in larger, larger projects to quickly add new generation capacity to the grid. electricity.
Various actions have been taken to streamline management processes for energy projects with multiple activities under consideration. The Department of Forestry, Fisheries and Environment (DFFE) has waived the requirement for an environmental permit for transportation infrastructure in low and medium sensitive areas and in transport corridors. strategy. Average times have been reduced for various management processes, including grid connection, NERSA registration, water permits, environmental impact assessments and land use permits.
Eskom is taking steps to address challenges at the power plant level, including deploying former power plant managers and qualified professionals to improve operational efficiency and reduce part losses load.
A new ministerial decision has been submitted to NERSA to approve more than 18,000 MW of new generation capacity from wind, solar and battery storage.
A revised RFP was issued for Procurement Mechanism 6 to increase the amount of generation capacity purchased from 2,600 MW to 5,200 MW.
In September 2022, an additional 200 MW was purchased through the South African Power Complex, and work is underway to increase imports from the region.
A standard offering approach has been developed to enable Eskom to obtain additional capacity of up to 1,000 MW from existing generators, subject to market response.
Work is underway in Eskom to develop a mechanism to capture excess energy from customers to increase adoption of rooftop solar installations.
The Electricity Regulations Amendment Bill, which provides for the establishment of an independent power transmission company and the emergence of a competitive electricity market, is being finalized for submission to Parliament.
The 2019 Integrated Resource Plan is being revised, with a goal of completion by March 2023, to update assumptions regarding energy availability and technological change.
“These measures that are now in place will make a significant difference in reducing the risk of offloading and achieving long-term energy security,” the President said.
Finance Minister Enoch Godongwana will present the Mid-Term Fiscal Policy Statement (MTBPS) on Wednesday, October 26. Some agencies expect it to address the key factors surrounding fiscal and economic sustainability in South Africa. Global and national macroeconomic instability in recent years has resulted in significant […]
BusinessFinance Minister Enoch Godongwana will present the Mid-Term Fiscal Policy Statement (MTBPS) on Wednesday, October 26. Some agencies expect it to address the key factors surrounding fiscal and economic sustainability in South Africa.
Global and national macroeconomic instability in recent years has resulted in significant revisions in the public financial outlook from one financial report to the next – and the MTBPS of This week is expected to follow this trend, Bureau of Economic Research (BER).
Surprisingly, South Africa’s revenue exceeded expectations due to higher-than-expected inflation, which boosted nominal GDP expectations.
According to Nedbank’s MTBPS overview report, tax revenue has been supported by high inflation and dynamic revenues in the first five months of 2022/23 showing that total budget revenue is exceeding budget estimates. financial year book.
Total revenue increased 10.3% year-on-year in the five months to August, with significant increases in corporate tax (15.3%), personal income tax (8.4%) and value added tax (VAT) (11.9%). ), Nedbank said.
The Bank expects revenue to grow by 8% in 2022/23, higher than the National Treasury’s forecast of 2.9%, resulting in revenue surpassing R130 billion.
However, PwC points out that although tax revenue – the largest contributor to tax revenue – grew more than expected in fiscal year 2022/2023, the fiscal outlook remains a budget deficit. growth in the medium term along with the continuous increase in debt.
Nedbank expects spending to grow at an average annual rate of 6.4% (in nominal terms) between 2022/23 and 2024/25.
Due to overdrafted revenue, many are now looking to MTBPS to reveal how much additional income will be consumed by additional spending pressure. The key factors that MTBPS is expected to address are: Revised spending on consolidated payrolls could be Rs 20 billion higher for 2022/23 than forecast in February, the BER noted.
PwC added that the MTBPS must strongly reiterate that the government will not backtrack on its promise to reduce the pressure on the budget from payroll costs, which will test the resolve of the national treasury to reduce payroll increases. average is 7.3. % each year. 2014/2015 and 2019/2020 only 2.1%/year in the medium term.
Public sector unions have rejected the government’s 3% salary offer and are demanding 6.5%. The Reserve Bank of South Africa has warned that the wage increase has the effect of pushing up inflation, which could lead to further rate hikes.
Momentum Investments said the pace of government spending is expected to pick up following the final pay agreement between the government and public sector unions.
According to Nedbank, after the unions in Eskom and Transnet secured 7% and 6% increases for the current financial year, civil servants could hardly accept increases of less than 6%.
The assumption of 6.5% in 2022/23 and an average of 5% per year in 2023/24 and 2024/25 would raise wage costs by 8% or R180.7 billion over the MTEF period, over the National Treasury’s February 2022 Budget, which was based on an annual average rise of 1.8% per year.
“Based on our revenue forecasts, the wage bill would absorb 37% of fiscal revenue per year over the MTEF period,” it said.
More bailouts for state companies
The budget may include more funds for non-Eskom state-owned enterprises (SOEs), including Transnet, says the BER.
Momentum Investments noted that although the government stood firm on the issue of additional bailouts for SOEs at the medium-term budget in October 2021, the adoption of a tough stance on SOEs will be tested in the medium term as a number of critical SOEs continue to struggle with operational and financial inefficiencies, corruption and mismanagement.
“Challenges faced by SOEs have resulted in poor service delivery, higher unemployment, low business confidence and weaker economic growth,” the group said.
Allowances – including Basic Income Allowance
BER said another concern on the spending front is whether the Treasury is planning to extend the Social Distress Relief (SRD) grant ) 350 per month and if any, if there is an implicit tax then the increase is expected within the budget framework to finance this.
Others, like Chief Economist Maarten Ackerman, oversee anything related to basic income subsidies.
“In terms of South Africa’s macroeconomic outlook, it is important to note that there has been another wave of earnings in addition to outperforming sales in recent years. So we’ll have to see what the finance secretary does with it,” Ackerman said.
“We want the proceeds of profit to be used productively, not just for temporary, one-time social spending with little or no effect. use to stimulate economic growth.
According to PwC, the Treasury considers viable funding options for the Basic Income Allowance as undesirable – including personal income tax increases, property tax implementation, value added tax rate increases ( VAT), take on new debts or reallocate existing funds.
However, Godongwana said on September 19 that the National Treasury is considering income support as part of an overall social security plan – where income support is only one component.
“The Minister of Finance has indicated that the MTBPS may have an opinion on this matter. We believe it is essential that the comprehensive social security framework be detailed as soon as possible in light of the country’s socioeconomic challenges and the ongoing broad debate about a BIG ,” said the group.
Response to Electronic Toll Collection
Transport Minister Fikile Mbalula has long promised to find a way out of Gauteng’s failed electronic toll collection project. He pinned the date of the last word on the system to this week’s budget day.
It is not yet known what will happen to the system, but the Minister has no doubt that no matter how the system is changed – whether it is transformed or abandoned altogether – the debt of the system must be paid.
Over the past few years, the Treasury has granted the Sanral sugar agency billions of grants to cover shortfalls and debt accumulated on the system, and this is expected to continue.
In fiscal year 2021/22, Sanral received R3.85 billion in the form of GFIP funding, compared to R2.72 billion in 2020/21. The failure of the system – which represented 1% of the roads in its portfolio – resulted in the freezing of all future jobs.
Eskom Debt Assumption
Another key element of MTBPS will be news of a “solution” to Eskom’s unsustainable debt burden, the BER said.
Eskom’s debt stands at around Rs 400 billion, and the BER expects Godongwana to move about Rs 200 billion of electricity debt to the government’s balance sheet – as Eskom has argued that its repayments only sustainable at Rs 200 billion.
However, the BER believes that the increase in overall public debt due to debt transfers from Eskom can be relatively contained thanks to overdraft revenue in 2022/23.
PwC said that while shifting Eskom’s debt to the government would further worsen fiscal indicators, it could also be the only option available to shore up the power company’s finances and economic prospects of the country.
BER and PwC said the transfer should be welcomed as South Africans will likely prefer the debt transfer option over a 32.7% increase in electricity prices in 2023, as Eskom has asked the Authority. National Energy Administration of South Africa (NERSA).
BER expects total public debt for 2022/23 to grow to about 73.5% of GDP from 72.8% of the Treasury forecast in February.
Budget Allocation After a Chaotic 2022
The February 2022 National Budget was tabulated before Russia invaded Ukraine. As a result, growth forecasts were revised downward globally while inflation estimates spiked following an additional shock in commodity markets.
Nedbank report says intense dump, lingering effects of KwaZulu Natal flood damage, labor strike and Russo-Ukrainian war pose downside risks to February growth forecast 2022 of the Ministry of Finance.
Real GDP is expected to grow 1.8% in 2022, slightly below the National Treasury forecast of 2.1% in February. Nedbank said that in 2023, the economy will likely face a global slowdown and rising interest rates.
The Nedbank report forecasts that growth will slow to 1.2% in 2023, compared with 1.6% for the National Treasury. As a result, the National Treasury is expected to revise down its real GDP growth forecast and raise its inflation forecast.
The Bank further emphasized that improving financial measures is dependent on temporary factors and therefore the need to maintain fiscal discipline remains paramount.
Controlling spending – maintaining low growth in interest-free recurrent spending – will have to be achieved through tight controls on the public sector wage bill and transfers, he added. society. Nedbank said economic growth forecasts face significant downside risks, which could undermine revenue growth and worsen fiscal indicators
Offshore Exposure Limits In February 2022, the offshore limit of Regulation 28 (Reg 28) was revised and simplified by Minister of Finance Enoch Godongwana . Previously, the limit was 30%, but managers can also have African exposure beyond the existing limit abroad of 30%. However, […]
BusinessOffshore Exposure Limits In February 2022, the offshore limit of Regulation 28 (Reg 28) was revised and simplified by Minister of Finance Enoch Godongwana .
Previously, the limit was 30%, but managers can also have African exposure beyond the existing limit abroad of 30%.
However, most managers have little exposure to Africa. Now it’s much simpler. Globally, regulators can have up to 45% of foreign exposure, but Africa still has a 10% limit.
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This amendment applies to retirement products. Life annuities are not subject to Policy 28 because they are an insurance product. Nor does it apply to so-called binding investment, or what we sometimes call discretionary saving.
Previous Changes to Regulation 28 limited
There was an initial 15% offshore allocation. But over time, Regulation 28 allowances have increased to allow for more exposure abroad.
As a result, asset managers have moved closer to the 30% cap we had before February 2022. We expect outbound exposure to start increasing again for gender new 45% limit.
The asset class that is likely to underweight is domestic stocks, this is a trend we have seen in the past.
In terms of change, this is absolutely positive for investors. This costs the investors nothing and essentially gives people more options and takes more time.
We don’t think we need more than 45% exposure abroad. Whether the limit is 45% or 100%, foreign exposure will peak at around 40%.
With more options for strategy building, the result will be a more efficient portfolio, more freedom of movement, a more diversified perspective, and ultimately, good risk-adjusted returns. for the entire industry.
Generous limits are good and good, but not without its challenges. One of the obstacles to investing abroad is that we invest in foreign currencies, such as US dollars, but the return is in rand.
The value of the Rand per US dollar provides additional volatility for overseas asset classes.
Thus, if we expose uncorrected, 45% tends to be too much. If one can profitably hedge some foreign exposure, almost all investors should invest 45% abroad.
For context, our optimization results indicate that our outbound exposure, for 6% plus inflation strategies, will likely increase from 30% to 40%.
In more conservative commodities, overseas shipments will only increase a few percentage points.
Valuation
The key message is that we intend to increase our foreign exposure, especially for our equity-intensive balancing strategies.
However, the Rand has weakened considerably, and offshore Rand is not an attractive level.
In terms of stock valuation, we look at South African stocks, global non-US stocks and US stocks to quickly gauge their relative attractiveness.
We see global equities outside the US hovering around fair value or just below. The US market is relatively expensive. Therefore, from an equity perspective, now is not a good time to rush.
When it comes to global bonds, South African government bonds offer very attractive yields, especially compared to developed market bonds.
Again, this is not a good time to sell locally and buy abroad.
In short
No matter how far we want to go, an opportunity presents itself without signaling that we have to rush and do it tomorrow.
In all likelihood, we will most likely move overseas in incremental steps and look for the right timing when there are global sales or local market rallies
“We have big economic problems, big problems, very big problems,” Motlanthe said in an interview Saturday in the Drakensberg Mountains on the sidelines of a conference organized by this organization. The ANC must ‘interact differently with voters, not just make promises again’, but make sure […]
“We have big economic problems, big problems, very big problems,” Motlanthe said in an interview Saturday in the Drakensberg Mountains on the sidelines of a conference organized by this organization. The ANC must ‘interact differently with voters, not just make promises again’, but make sure people experience real change, if it’s to stay in power, he said.
Several opinion polls suggest the ANC is in danger of losing the absolute majority it has held since taking power in the country’s first multiracial elections in 1994, a backlash. once again from high levels of poverty and unemployment, record power outages and rampant corruption.
Motlanthe’s criticisms of the party are all the more acute in that he is one of the most respected veterans and head of the party’s election committee. He was appointed interim president in September 2008 after the ANC forced Thabo Mbeki to resign and held the post for seven months until new party leader Jacob Zuma took office.
Cyril Ramaphosa, who succeeded Zuma as ANC leader in December 2017 and served as president two months later, will seek a second term at the party’s electoral convention in two months.
Continuous changes in the party leadership are problematic because there is a risk that the government’s approach will become short-term oriented, according to Motlanthe. “Once every five years, you can have a new administration, new faces and some solutions, which can work in the next six or eight years,” Ms. Motlanthe said. head.
Other interview highlights:
The country’s energy crisis is “a major driver of productivity and therefore a very negative impact on the economy.” More renewable energy production capacity needs to be operated, power plants need proper maintenance, and the country needs to tap into its natural gas reserves.
“We can really create a new sector of the gas-based economy. If you say that every building has gas lighting, heating, and cooking, you’re creating real jobs by having people cross-link every building.
Logistics in South Africa relies too much on roads, which have already been subject to “heavy penalties”. High fuel prices are exacerbating already high inflation, which has eroded living standards and led to strikes