President Ramaphosa should be highly commended for his decisive leadership and rapid action at the start of the coronavirus crisis. The response from government at that time is precisely what anyone could have hoped for – following consultation with medical experts and with due consideration to scientific analysis and global best practice, a strict lockdown was implemented in order to stem the spread of the disease. This was a brave decision given that so much was unknown about this virus at the time, however concern is rapidly growing around the severity and duration of the lockdown, particularly as new data and insights into this virus emerge.



<figure><iframe loading="lazy" width="560" height="315" src="https://www.youtube.com/embed/Hvwvx1DGxaM" allowfullscreen=""></iframe></figure>







The stark reality is that South Africa simply cannot afford an extended lockdown period. We do not have the financial muscle deployed by developed nations to mitigate the negative economic consequences of an extended lockdown, especially following more than a decade of rampant looting of state resources. There also seems to be an automatic assumption that big business will bear the brunt of the economic crisis – we are expected to keep paying salaries, to keep paying taxes (although deferred to assist with immediate cashflow challenges), to keep paying rentals, and to keep servicing loans. How is that possible when we are not allowed to generate revenue? Business has been forced to navigate a torrid operating environment over the past decade and many have experienced significant capital erosion. An extended lockdown period will be the final nail in many coffins and we’re already witnessing the agonising demise of some of South Africa’s best-known companies. If this trend continues, there will be little left to save by September.



It may seem callous to call for a return to business when it may result in further infections and deaths, however this is not a case of prioritising profits over lives. If SA hopes to rebuild any form of economy following this pandemic, we will need a strong and cooperative business sector. Government can neither manage this crisis on their own nor rebuild the economy and create jobs following it. However, the long-term sustainability and needs of big business is conspicuously absent from the current presiding narrative.



It would be expected that the medical professionals advising government would be biased toward the preservation of life and whilst their perspective is invaluable, it needs to be balanced with a view toward the long-term prosperity of our nation. The latest research and statistical analysis indicates that far more people may lose their lives as a result of the humanitarian crisis created by the lockdown than from the virus itself. The concern at this stage therefore goes far beyond business sustainability but also extends to our national ability to maintain social order and mitigate the catastrophic impacts of the lockdown. Business has a duty of care and stewardship toward the society in which we operate but we cannot exercise that duty if our voices are not heard or our sustainability concerns addressed.



The unfortunate truth is that there are many things that kill South Africans every year, not least of which is TB – a completely curable disease that kills approximately 3000 South Africans every month (compared to 161 CV-19 deaths during the past two months). A tragic consequence of the attention being focused on this novel disease, is the stigma that inevitably follows it, and there are now reports of TB and HIV patients who have stopped visiting local clinics to collect their TB and HIV medications, for fear of being stigmatised as COVID-19 cases. Whilst the coronavirus might kill you, TB will kill you if left untreated. If the intention is really to save lives, there are numerous initiatives that could do that without destroying the entire economy.



It is still completely unknown how severely South Africa may be impacted by COVID-19. Everything that’s been done to-date has been based on modelled projections of what could happen. Those models are based on data from other countries which are significantly different to South Africa. We simply don’t know if our climate, National Routine Immunisation Schedule, or any other factor may have a mitigating effect. What is clear is that the actual death rate has been substantially lower than previously predicted. The claim that this was because of the severity of the lockdown seems unlikely, as it is fairly apparent that social distancing is not being adhered to in most parts of the country with extensive queueing and crowding happening every day as an increasingly desperate populace attempts to collect grants or secure a meal.



The data being disseminated globally, and which likely informs the thinking of our national advisors, is also horribly skewed in order to support a particular narrative. Whilst total death rates are constantly updated and serve to strike fear into our hearts, it has now emerged that less than 3% of all deaths in the USA and Italy could be directly attributed to COVID-19. The other 97% of patients already had at least one severe co-morbidity which may have resulted in death anyway. Whilst 270&nbsp;000 people have died from COVID-19 globally (including the 97% who had pre-existing conditions), it may surprise you to learn that around 18 million die every year from cardiovascular diseases (albeit non-communicable) and 1.2 million from the worst infectious disease, tuberculosis (TB). It begs the question as to whether the global response, based on projections of a worst-case scenario, has been proportionate to the actual risk and observed impacts to-date.



It is expected that a vaccine, if it is even possible to create one, will take at least another 18 months. There is no country that will be able to enforce a lockdown for that long. Lockdowns will not eradicate the virus, so we already have to accept that countries will start opening their economies while this virus is still around. Given that we are not investing in new healthcare infrastructure that requires long build times, we have to accept that we are as prepared as we can be for the inevitable spike in cases. There is no point in delaying the inevitable any longer whilst the economy crumbles and our people starve.



Government urgently needs to engage business as partners in this crisis. A key issue with respect to a continued lockdown is the extent to which testing has been done. With relatively few tests completed and a slowing of the government testing rate, we do not have a sufficiently broad and deep data set to understand how and where the disease is spreading in the country. In the absence of such data, a national lockdown becomes the only blunt instrument at the disposal of government to curtail the spread of the infection. Allow business to return and shift the responsibility of testing every employee onto the private sector – it is in the interests of business to ensure we have healthy employees and the exponential growth in the data set will be invaluable for government decision-making.



With some questionable decisions being made and confidence in government waning &#8211; the obscure National Command Council and its lack of transparency around regulatory decisions has not helped in that regard – it is very quickly approaching a situation where large-scale State violence will be required in order to enforce the lockdown regulations. This is perhaps why the decision was taken to deploy more than 73&nbsp;000 additional soldiers in our streets. Given our history in this country and our hard-fought democracy, can we really accept that more people may die from hunger and State violence to enforce the lockdown, than may actually die from the virus?



For more coverage on COVID-19 visit: <a href="https://www.cnbcafrica.com/covid-19/">https://www.cnbcafrica.com/covid-19/</a>

Here’s how to apply for SA’s COVID-19 loan guarantee scheme

Op-Ed: South African businesses call for urgent end to lockdown

By Andrew Lapping, Chief Investment Officer at Allan Gray



As South Africans, we want our country to prosper and the quality of life for all those living within our borders to improve. Millions live in total poverty and rely on family or intermittent work to get by: life is tough, and often short, as malnutrition and hardship take their toll. The most effective way to lift people out of poverty and improve quality of life is through education and economic growth.&nbsp;



I am concerned that our government’s lockdown approach and the subsequent economic hardship inflicted on our people will cost more lives than it can save. I realise this is a controversial statement in a context where people are very fearful and understandably concerned about their health and the wellbeing of their families. An effective government must make difficult decisions that involve trade-offs and cost-benefit analysis. I am not saying we should trade lives for economic growth; I am saying we must consider how we can save as many lives as possible and give better lives to as many South Africans as possible with our limited resources.&nbsp;



President Cyril Ramaphosa’s initial lockdown decision was justified to buy time in order to gather our health resources and prepare our hospitals. It was never meant to be a strategy to eliminate the COVID-19 virus – this is an impossibility. The idea behind lockdown is that the same number of people get ill, but the infections are spread over a longer time in an effort not to overwhelm the health system. Our government’s lockdown strategy has morphed into something else entirely.&nbsp;



As new information emerges, it seems the virus mortality rate is substantially less than many feared, and many of the more alarmist predictions that led to lockdowns across the globe have proven to be flawed. The government must absorb this information, particularly given the youthful South African population.



There are two important questions:



<ul class="wp-block-list"><li>How many COVID-19 fatalities can be avoided through the lockdown?</li><li>What is the economic, and therefore human, cost of the lockdown?&nbsp;</li></ul>



I will not go into detail on the potential number of lives saved by the lockdown. There is a great deal of information available* that indicates the lives saved by this strategy will be minimal unless the lockdown means the number of infections can be supressed until a vaccine becomes available. Data indicates the mortality rate for those below 70 years of age is less than 0.2%; only 2.9% of South Africa’s population is older than 70. Furthermore, lockdowns or a lack thereof, seem to make little difference to the total number of cases a country experiences. It sounds tragic and defeatist, but it is not possible to make the virus disappear through lockdown, particularly in a country like South Africa.&nbsp;



Economic and human costs are two sides of the same coin. Studies indicate that mortality rates double with job losses. A smaller economy means fewer resources to allocate to healthcare and education in future. National Treasury thinks up to seven million people could lose their jobs. This could lead to tens of thousands of additional deaths.&nbsp;



The stimulus package outlined by the government is R500bn. SARS thinks tax collection could fall by R250bn this year as a result of the shutdown.&nbsp;Given government reallocations, this means additional debt of&nbsp;approximately R500bn in a single year. The economic damage will linger, tax collections are unlikely to recover to previous levels for years to come. The&nbsp;R50bn interest bill on this additional debt burden means&nbsp;R50bn less to spend on education, healthcare or other services – not just in 2020, but in perpetuity.&nbsp;



An extreme worst-case scenario for South Africa is 150&nbsp;000 COVID-19 deaths (most models indicate worst-case scenarios of 50 000). This is based on 50% of people contracting the virus with a 0.5% fatality rate. (A more likely worst case is a 0.2% mortality rate of 50% of the population, which is 60 000). This is a huge number of deaths and a great tragedy. Let’s assume the lockdown manages to reduce the number of fatalities by 50% by supressing the illness until a vaccine is discovered: This would be an incredible success. 75 000 lives would be saved. The direct cost per life saved in this scenario is R6.6 million; indirect costs will be far greater. I know this puts a price on human life but, unfortunately, this is what government has to do every day when allocating resources. On&nbsp; the other end of the spectrum, if the disease can’t be stopped, and a vaccine is not discovered, then almost no lives will be saved from COVID, but we will have destroyed the economy, increased government debt by R500bn, and lost a great number of lives through higher mortality not related to COVID. South Africa’s 2020 budget called for healthcare spending of R229bn and police expenditure of R221bn: small amounts in comparison.



Sadly, because South Africa is a poor country, we have a very high mortality rate, and therefore low life expectancy. 410 000 South Africans die from natural causes each year, including 37 000 people from TB and 32 000 from diabetes. In addition, 15 000 die in road accidents and 21 000 are murdered. These deaths are equally tragic and perhaps even more so as they are often preventable.&nbsp;



Unlike Europe, South Africa has a limited social security net and an informal economy. Many people have no savings and have lost their livelihood with the lockdown. Hunger is an immediate reality. Malnourished children are disadvantaged for the remainder of their lives due to stunting. The government provides a child grant, but there are millions of immigrant children who have no access to this grant.&nbsp;



Just as economic growth and prosperity save lives, economic destruction and poverty cost lives.&nbsp;



So why am I writing this now? Firstly, every week the lockdown continues, the economic cost compounds. Since the lockdown was enacted six weeks ago, I have urged government to consider the full picture, including the human and economic costs of their decisions, and I have provided them with balanced data. I have detailed how this data indicates the lockdown strategy is tragically flawed. We can no longer afford to blame “the virus”, when the vast majority of the job losses and suffering is the consequence of a strategy that has not fully accounted for the human cost of the lockdown on the economy. I hope that in making this commentary I am contributing to a heightened awareness of the issues, not emotion, underpinning this discourse.



Secondly, it is to reiterate how we think about managing your portfolios against this backdrop. We all have our views on what is the right or wrong strategy for government. However, most importantly for us as investors, we must deal with the situation as it is, and invest your funds accordingly to protect capital and maximise long-term returns.



For more coverage on COVID-19 visit: <a href="https://www.cnbcafrica.com/covid-19/">https://www.cnbcafrica.com/covid-19/</a>

COVID-19: South Africa eases lockdown to revive battered economy

Op-Ed: Counting the economic cost of South Africa’s lockdown

JOHANNESBURG (Reuters) &#8211; South African mobile operator Vodacom Group reported a 8.9% rise in annual earnings on Monday, buoyed by an improved second half performance in its domestic market and the sustained growth of its international businesses.



Headline earnings per share (HEPS) for the full-year ended March rose to 945 cents from 868 cents a year earlier.



HEPS is the main profit measure in South Africa and strips out certain one-off items.



Vodacom, which is majority owned by Vodafone, declared a final dividend of 405 cents per share.



(Reporting by Nqobile Dludla; Editing by Kim Coghill)



This article was first published on Reuters Africa <a href="https://af.reuters.com/article/investingNews/idAFKBN22N0U0-OZABS">https://af.reuters.com/article/investingNews/idAFKBN22N0U0-OZABS</a> and is republished with its permission.

Administrators propose sales plan for SA retailer Edcon, see potential job cuts

South Africa’s Vodacom reports 8.9% jump in full-year earnings

By Chris Bishop



Scores of countries across Europe celebrated VE – Victory in Europe day – today to mark the end of World War Two that saw the slaughter of tens of millions of people of all creeds and colours from the deserts of North Africa to the snows of Scandinavia.



This is a good time also for Africa to reflect on it sacrifice between 1939 and 1945 that also acted as a catalyst for change on the continent. One million people took up arms in Africa to fight the crushing power of Nazi Germany, Japan and Italy. South Africa recruited more than 300,000 men – around 70,000 of them black South Africans who fought, worked and died usually unsung. The rush to the colours was staggering in some African nations – Botswana, then called Bechuanaland, asked for a couple of thousand army volunteers from its far flung villages and saw 10,000 recruits in just over a month. When I wrote a story on those men, in 2000, most then in their late 70s, many had kept proudly their uniforms and war medals and could still salute smartly as any parade ground peacock.



Tens of thousands never came back. Many of the black riflemen who fought hand-to-hand with the enemy received little reward, maybe a new suit and a bicycle, and often died in poverty.



One such overlooked hero was Job Maseko from KwaThema, in Springs near Johannesburg. He was a delivery man in his home town and joined up in the then Native Military Corps. &nbsp;Following his basic training he was shipped to North Africa, in 1942, to face General Erwin Rommel’s tough Afrika Korps that had the allies on the run.



On June 21 1942 Rommel’s tanks swept into Tobruk capturing thousands of allied soldiers including more than 10,000 troops of the South African 2nd Infantry Division. Among the 30,000 prisoners was Lance Corporal Job Maseko.



Italian troops held the black South African soldiers under guard and by all accounts treated them poorly. This angered the feisty Lance Corporal Maseko who swore revenge against his enemy captors. They forced Maseko to work loading an Italian military supply ship. He took a milk tin and filled it with cordite and a fuse. With the help of his fellow prisoners he placed it among petrol drums deep down in the ship and blew it sky high – a big blow to the enemy war effort.



Generals recommended Maseko for a Victoria Cross – the highest award for gallantry in wartime regardless of rank – but the colour of his skin counted against him, in their eyes. Instead, they awarded him a lesser Military Medal.



“In carrying out this deliberately planned action, Job Maseko displayed ingenuity, determination and complete disregard of personal safety from punishment by the enemy or from the ensuing explosion which set the vessel alight,” said the medal citation.



When Lance Corporal Maseko came home there was little waiting for him and he died in poverty. In 1952, a train did what the Germans and Italians couldn’t – it hit Maseko and killed him.



Yet others who went to the war from Africa – from Johannesburg to Kenya to Nigeria – returned to fuel the fires of independence. They had seen how their white comrades-in-arms had bled and screamed for their mothers, too, as they died. It exploded many colonial myths of white supremacy and created a generation of battle hardened patriots ready to question and throw off the shackles of imperial rule.



VE Day is not only a time to reflect on the ending of a world war – it is also a time for Africa to reflect on the sacrifices of its great-grandfathers, who fought toe-to-foe with fascism; and also how it led to hard won freedoms at home.

Job_Masego00

Victory in Europe Day – Time for Africa to reflect on its blood and sweat sacrifice

By Chris Bishop.



Like most hard pressed entrepreneurs in Africa, Don Scott had to cut costs and batten down the hatches in the face of the COVID-19 lockdown – like very few, he also had to worry about wild animal invasions and encroaching bush.



Scott, an engineer by trade, runs the Tanda Tula lodge, in Timbavati near the Kruger Park, in northern South Africa. Right now it is operating on a skeleton staff as most of his 62 workers are taking leave; they were paid for April, but took a 15 per cent cut. For those left, their full time job is trimming back the fast growing bush and stopping the wild animals, that live in it, from taking over the resort.



“If you let a game lodge go you will never find it again!” laughs Scott. As speak on the telephone a pride of lions has just walked across his manicured lawn- six males and four lionesses, he says, before continuing with his story.



“What the few of us left have got to do is cut back the trees and make sure there is enough human activity around the camp. If there is then usually the animals stay on the periphery.”



Scott watched the lights go out at his game lodge in a few crazy days in March. The travel ban was declared on March 15 and the resort emptied. On that Sunday, 22 of the camp’s 24 tents were occupied by tourists from the United States, France and the United Kingdom. By the following Friday, nearly all the tourists had fled to the airport. On that evening, two British holiday makers remained rattling around in the huge dining room at the lodge.



“We got all the staff together and sat down and had dinner with them so they didn’t feel lonely,” says Scott.



“But to be honest, I think we were all trying to keep each other’s spirits up.”



For now Scott spends his days hacking at the bush, watching out for lions and waiting for the travel restrictions and lockdown to subside. Until it does there won’t be a tourist in sight in Timbavati and lions will be the fleeting kings of the lawn, as well as the forest.



Don Scott will be taking part in the CNBC Africa virtual panel discussion Business Tomorrow at 14 00 CAT on Channel 410 on Tuesday May 12. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

don scott

How COVID-19 led to wild animal invasions in Africa.

South Africa’s Department of Employment and Labour has through the <a href="https://www.cnbcafrica.com/videos/2020/04/29/uif-pic-in-talks-with-edcon-over-a-potential-lifeline/">Unemployment Insurance Fund (UIF)</a> disbursed almost R9.5 billion (R9,474,081 937.26) through the <a href="https://www.cnbcafrica.com/videos/2020/05/05/covid-19-bites-into-sas-tax-revenue/">COVID-19</a> Temporary Employer/Employee Relief Scheme (TERS) benefitting 1,937,558 workers.



A total of 619,365 workers are still to be paid more than R2.6 billion pending the correct information being supplied to the UIF.



The following statement provides more details:



DEPARTMENT OF EMPLOYMENT AND LABOUR CONTINUES TO MAKE LIVES EASIER WITH ALMOST R10-BILLION DISTRIBUTED TO UIF CONTRIBUTORS



The Department of Employment and Labour continues in its quest to make the lives of workers easier during the lockdown by paying them through employers and bargaining councils.



As of today, the department through the Unemployment Insurance Fund (UIF) has disbursed almost R9.5-billion (R 9 474 081 937.26) through the COVID-19 Temporary Employer/Employee Relief Scheme (TERS) benefitting 1 937 558 workers.



&#8220;This is a critical infusion and further creates a safety net for workers who may ordinarily not be paid because of the lockdown as a result of the Coronavirus pandemic. We serve the people of this country and it is particularly at this point that we demonstrate the nature of caring government thus ensuring that to the extent possible, no person is left behind.&nbsp;



&#8220;This intervention should be seen as part of the government-wide effort to mitigate the worst effects of the pandemic&#8221;, said Minister Thulas Nxesi.&nbsp;



Prudent investments by the UIF enabled it to meet its obligations despite revenue falling by over R400-million as a result of decreased contributions.



&#8220;We still appeal to employers to make the necessary applications; provide the fund with more information where we have sent queries and to pay the workers the money due to them&#8221;, Nxesi continued.



A total of 619 365 workers are still to be paid more than R2.6- billion pending&nbsp; the correct information being supplied to the UIF.



Issued by the GCIS on behalf of The Department of Employment and Labour



07 May 2020



For more coverage on COVID-19 visit: <a href="https://www.cnbcafrica.com/covid-19/">https://www.cnbcafrica.com/covid-19/</a>

ArcelorMittal South Africa fined R3.64 million over hydrogen sulfide emissions

SA workers receive R9.5bn through UIF’s COVID-19 relief scheme

By Chris Bishop.



It was raised and tended, by hand, in the shady herbal gardens on an island amid the warm sea breezes of the east coast of Africa. It is intended to fight the COVID-19 pandemic, but the World Health Organisation says: don’t touch it &#8211; yet.



It is a balm produced from a plant called Artemesia blended with a collection of herbs grown on the island of Madagascar.



Madagascan President Andry Rajoelina has presented it to heads of state at the African Union as a herbal prevention of treatment of COVID-19. For centuries – long before pharmaceuticals factories were built – African herbs were a natural and trusted way of healing and warding off ailments. The liquid is being made by the Madagascar Institute of Applied Research and distributed door-to-door by soldiers in the capital Antananarivo. &nbsp;



Yet, in its online briefing to journalists, WHO’s regional director Matshidiso Moeti warned Africans to steer clear of the liquid from Madagascar.



“We are advising the government of Madgascar to take this through a clinical trial…So, we would caution and advise against countries adopting a product that has not been tested for its efficacy. Everything should be used only after clinical trials,” says Moeti when questioned about the elixir from Madagascar.



“We are concerned that the touting of this product as a preventative measure might stop people doing the right things to protect themselves.”



South Africa’s health minister Zweli Mkhize tweeted: “We received a call from the government of Madagascar, who asked for help with scientific research. Our scientists would be able to assist with this research. We will only get involved in a scientific analysis of the herb. We are not at that point yet.”



Moeti, a South African born doctor raised in Botswana, painted a grim picture of the fight against COVID-19 that has seen 2000 people die. To make matters worse, she said, 1000 health workers had fallen foul of the disease leaving a shortage of workers in treating all diseases. &nbsp;&nbsp;&nbsp;



“I have a lot of faith in the resilience of African people. We will not see a continent flattened and in despair. It will be difficult but I am sure we will come through this together and stronger,”says Moeti.

MADAGASCAR-HEALTH-VIRUS

The anti-COVID-19 herbal balm from the sea breezes of  Madagascar – why the World Health Organisation says don’t touch it for now.

By Emma Rumney



JOHANNESBURG (Reuters) – The expansion of South Africa’s auto industry is central to the government’s economic development strategy but the coronavirus crisis has forced carmakers into survival mode and could push ambitious growth plans out of reach.



Industry officials say the government needs to defer some tax payments for the auto industry and relax the criteria for investment incentives and allowances, or the pandemic could deal the sector a permanent blow.



Before the crisis, the government had crafted a plan to supercharge the sector to help revive the country’s struggling economy and form a beachhead for expansion within Africa, the world’s last major untapped market for new cars. [nL8N21S590]



But a five-week lockdown has brought a manufacturing and retail industry that accounts for almost 7% of South Africa’s gross domestic product and 30% of its manufacturing output to a virtual standstill.



“Those plans will be impacted massively,” said Mike Mabasa, chief executive of the National Association of Automobile Manufacturers of South Africa (NAAMSA). “Particularly for the short to medium term, that plan is completely out of the window.”



South Africa has put its so-called automotive masterplan at the heart of attempts to revive growth through industrialisation after years of stagnation and to bring unemployment down from almost 30%.



The plan aims to boost growth and create jobs by more than doubling the industry’s annual production to 1.4 million vehicles by 2035 and raising the proportion of auto components made locally to 60% from 39%.



The new scheme comes after a series of auto industry development plans and will be supported by investment and tax incentives that have been in place in some form for years.



They include a tax-free cash grant starting at 20% of the value of qualifying investments, rising to 25% for component makers, and a tax perk related to vehicle production, known as the vehicle assembly allowance.



SCANT RESPONSE



Mabasa said NAAMSA has asked the government to relax the minimum plant production capacity threshold of 50,000 cars a year needed for the investment incentive as carmakers believe it’s too stringent given the fallout from the crisis.



As part of series of requests on behalf of the industry, NAAMSA has also asked the government to use 2019 production numbers and targets for 2020’s vehicle assembly allowance, as output is likely to take a major hit this year.



The sector had some relief with the easing of the country’s lockdown on May 1 as it allowed auto manufacturers to return to 50% capacity. But it has had scant response from the government to its calls for specific financial help, besides requests for more information.



The Department of Trade and Industry did not respond to requests for comment.



Most of South Africa’s automakers referred Reuters to NAAMSA for comment.



NAAMSA represents 41 firms – including BMW, Ford, Mercedes-Benz, Isuzu, Nissan, Toyota and Volkswagen &lt;VOWG_p.DE&gt; – which make some 600,000 vehicles a year in South Africa and export about 65% of them.



Mercedes-Benz South Africa said it was not possible to predict the impact of COVID-19 on the 2035 industry targets.



“We have constructive relationships with our key stakeholders in suppliers and the government, and are confident that we will be able to find solutions to maintain the competitiveness of the automotive manufacturing sector,” its corporate affairs manager, Thato Mntambo, told Reuters.



SMALL FIRMS VULNERABLE



NAAMSA’s Mabasa warned that if carmakers struggle for liquidity in the crisis they may be unable to fulfil export orders, worth $9 billion a year across the industry. Local component makers focused on autos could also suffer badly.



Industry officials said the damage could be permanent and open the way for upcoming rivals such as Morocco and more established centres like Thailand to steal market share.



Andrew Kirby, chief executive of Toyota South Africa, said last month that the risk to the country’s role in global auto industry supply chains stemmed mostly from the vulnerability of its smaller component manufacturers.



If either vehicle makers or parts manufacturers cannot deliver their products, international customers will rapidly take their business elsewhere, industry officials said.



Renai Moothilal, executive director of the National Association of Automotive Component and Allied Manufacturers, said there was a strong possibility smaller firms would not survive and that would be disastrous for the government’s drive to boost local output and double employment in the sector.



He said levers the government could pull included levy waivers and support for utility and wage bills, but without help it was not hard to see how an industry that has already lost much of its business case might contract rather than expand.



“Once global companies move export contracts, and invest in tools of production in another destination, the costs sunk into that move make it improbable that they would want to bring it back to South Africa,” Moothilal said.



HITTING RESET BUTTON



NAAMSA’s Mabasa said the overseas headquarters of some local component manufacturers had already indicated they could shift production to divisions outside South Africa.



About 90% of the business of one local supplier, SP Metal Forgings (SPF), is in the automotive sector. Chief executive Ken Manners said the initial three-week lockdown alone had probably cost it 12% to 15% of annual turnover.



Another local component supplier, Pressure Die Castings (PDC), said it was expecting to lose 15% of its turnover for at least three months from the start of the lockdown.



“If we were only in (auto) manufacturing, we probably would have closed the company,” said Graham Smith, managing director of PDC, which supplies components to several industries.



The car sector will benefit from some economy-wide tax measures already announced, such as deferred payments on a carbon tax, but the demands on South Africa’s strained public finances are huge, with many key industries in trouble.



With the country’s debt rating now firmly in junk territory and an economic contraction inevitable, there are questions over how it will even pay for measures already announced.



Meanwhile, the risk of a return to a more expansive lockdown looms and demand for vehicles at home and abroad has plummeted.



IHS Markit senior analyst Walt Madeira said car production will fall too. It forecasts global light vehicle sales will drop to 69.6 million units this year from 89.7 million in 2019, with a 20% decline in South Africa. (https://tmsnrt.rs/2WbOIfb)



And any change of tack by carmakers at the top of the production pyramid will ripple through the industry.



“It’s like pushing a big reset button and nobody is quite sure what that means,” SPF’s Manners said. “It’s very worrying in terms of what our businesses are going to look like in six months.”



(Reporting by Emma Rumney; Editing by David Clarke)



This article was first published on Sharenet <a href="https://www.sharenet.co.za/views/views-article.php?views-article=414382">https://www.sharenet.co.za/views/views-article.php?views-article=414382</a> and is republished with its permission.



For more coverage on COVID-19 visit: <a href="https://www.cnbcafrica.com/covid-19/">https://www.cnbcafrica.com/covid-19/</a>

SA’s auto industry ambitions threatened by COVID-19

HARARE (Reuters) &#8211; The World Bank will grant $7 million to Zimbabwe to help it fight the new <a href="https://www.cnbcafrica.com/videos/2020/04/30/morgan-co-on-covid-19-its-impact-on-zimbabwes-economy/">coronavirus outbreak</a> that is expected to worsen an already struggling economy and <a href="https://www.cnbcafrica.com/news/2020/04/02/the-fight-to-keep-4-1-million-zimbabweans-fed-in-covid-19-lockdown/">food crisis</a>, a bank spokesman said on Wednesday.



Zimbabwe is more than $1.2 billion in arrears to the <a href="https://www.cnbcafrica.com/videos/2020/04/09/world-bank-considers-debt-relief-for-africa-to-fight-covid-19/">World Bank</a>, <a href="https://www.cnbcafrica.com/videos/2020/04/09/afdb-announces-10bn-war-chest-to-fight-covid-19/">African Development Bank</a> and European Investment Bank, making it ineligible for funding or debt forgiveness from global lenders.



The World Bank spokesman said that while Zimbabwe and other countries indebted to the lender could not access regular financing, they could get money from its trust funds to fight the coronavirus that has slowed down the <a href="https://www.cnbcafrica.com/videos/2020/05/05/covid-19-what-the-world-can-learn-from-africa-in-dealing-with-a-pandemic/">global economy</a>.



“The bank’s senior management has underlined the need for additional trust fund financing to ensure that Zimbabwe and the small group of other countries in arrears can receive support as part of our global effort to help countries respond to the COVID-19 crisis,” the spokesman said.



Zimbabwe would get $5 million from the World Bank’s global financing facility trust and another $2 million would be diverted from <a href="https://www.cnbcafrica.com/videos/2020/05/04/how-the-covid-19-pandemic-is-taking-its-toll-on-african-livelihoods/">funds meant to help the country recover</a> from a devastating cyclone in 2019.



“We recognise this is a global crisis that impacts every country and we cannot leave anyone behind in our response,” the spokesman said.



Zimbabwe’s finance minister wrote to the International Monetary Fund and other lenders last month warning that the country was being driven towards a <a href="https://www.cnbcafrica.com/videos/2020/05/04/covid-19-lockdowns-when-is-the-right-time-to-reopen-economies/">health and economic catastrophe</a> by the coronavirus pandemic because its debt arrears mean it cannot access foreign financing.



The impoverished southern African nation has only recorded 34 cases and four deaths from the coronavirus but analysts say its fragile health system will not be able to handle any surge in infections.



(Reporting by MacDonald Dzirutwe; Editing by Mark Heinrich)



This article was first published on Reuters Africa <a href="https://af.reuters.com/article/investingNews/idAFKBN22I1QX-OZABS">https://af.reuters.com/article/investingNews/idAFKBN22I1QX-OZABS</a> and is republished with its permission.



For more coverage on COVID-19 visit: <a href="https://www.cnbcafrica.com/covid-19/">https://www.cnbcafrica.com/covid-19/</a>

Zimbabwe gets $7m COVID-19 lifeline from World Bank

By Tim Cocks, Shafiek Tassiem



JOHANNESBURG, May 6 (Reuters) &#8211; Most visitors wanting to see big game in Africa jet in from faraway places, so when the new <a href="https://www.cnbcafrica.com/videos/2020/05/05/covid-19-bites-into-sas-tax-revenue/">coronavirus</a> <a href="https://www.cnbcafrica.com/news/2020/05/05/covid-19-sa-based-airline-comair-enters-business-rescue/">grounded flights</a> and put the world into lockdown, the legendary African safari died.



But for South African company WildEarth — which brings virtual safaris to your living room via a camera that their guides drive around in an open top vehicle — it is boom time.



“We’ve seen a dramatic rise in our viewership of our live safaris,” founder Graham Wallington told Reuters. “A fivefold increase in the first two weeks in March.”



Wallington said they are currently attracting up to 3 million viewers a month, with an individual virtual safari hooking in as many as 200,000 at their most watched.



Twice a day, viewers can watch whatever animals the guides spot as they zoom around game reserves — they’ve filmed 200 spots across east and southern Africa since founding it in 2006. A 24-hour camera perched over a watering hole in South Africa’s Djuma Game Reserve also shows live images of whatever comes there to drink.



Highlights include a pack of jackals and African wild dogs fighting over a kudu carcass, a leopard cub jumping out of a tree, a mother cheetah playing with her kids and close encounters with elephants, hippos, lions, baboons and giraffes.



In all, the guides narrate the trials of the animals as they follow them around.



The footage is free to access. WildEarth makes revenue from selling premium video to broadcasters, from merchandise and a small amount of advertising, Wallington said, declining to give figures on turnover.



The main benefit for conservation efforts is that the videos are “making people fall in love with nature,” he said.



“They start seeing those animals as individual beings. That is the moment that the viewer empathises,” he said.



Whether it is commutes to work, long-haul business travel or sightseeing, the COVID-19 shutdown has a lot of people thinking about whether they need to always rush from place to place, or whether a virtual interaction would sometimes do just fine.



Wallington said the crisis had created “a real opportunity for people to generate money by creating virtual experiences.”



From an environmental point of view, it also cuts back on carbon emitted by flights, and could help popular spots, like East Africa’s Serengeti, recover from over-tourism.



“If our mission was just to bring more and more tourists, we would destroy the thing we want to save,” he said.



In the coming weeks, they plan to start paid-for private tours with currently out-of-work guides via a Zoom video call.



(Editing by Alexandra Hudson)



This article was first published on Reuters Africa <a href="https://af.reuters.com/article/southAfricaNews/idAFL8N2CM3LB">https://af.reuters.com/article/southAfricaNews/idAFL8N2CM3LB</a> and is republished with its permission.



For more coverage on COVID-19 visit: <a href="https://www.cnbcafrica.com/covid-19/">https://www.cnbcafrica.com/covid-19/</a>

COVID-19: Liven up your lockdown routine with SA’s ‘virtual safaris’

By Peter Armitage, Anchor Capital CEO/Liam Hechter, Anchor Fund Management



Recent weeks have been dominated by investors asking us where the best investment opportunities are in the aftermath of the global market collapse. Below, we review the asset classes across major geographies, with a focus on equities.



Introduction



There are a few principles which we apply and assumptions that we make in our assessment of global and local assets. First, we assume that the world will revert to normality, although we have no idea when this will happen. At Berkshire Hathaway’s annual general meeting on Saturday (2 May), billionaire investor and Berkshire CEO Warren Buffett referred to the current period of volatility as “an interruption of growth”. The world will revert to growth. However, we are actively avoiding those assets where a longer-than-expected reversion to normality can materially and permanently damage the business. We are also avoiding areas of high risk – there is no need to assume a big risk when investment opportunities abound. There is also great merit in being patient – if you have money to invest you have time on your hands. We are not getting overly anxious when markets decline – this presents opportunities but be prepared to act. We are not getting FOMO when markets rise, and we are not fully invested – volatility will prevail for some time to come. So, also be prepared to sit on your hands, when necessary.



From a global perspective, first we highlight that low-risk assets generate no, or even a negative, return. Global developed market (DM) bond rates are basically at zero to negative and cash in the bank erodes in nominal terms. If you do not allocate some cash to riskier assets (such as property and equities), your wealth will erode in real terms. This scenario will prevail for a long time to come and interest rates simply cannot rise.



So, when and how do you invest in equities and property globally?



The first point to make is that the change in environment has impacted sectors and companies very differently – this is not a time for index investment. Oil, cars, pigs and sugar (for example) are in a big surplus so, while some companies have seen their turnover head to zero, the environment has been very positive for others. Amazon’s 1Q20 revenue, for example, was up a remarkable 26% YoY.



Nevertheless, some caution is warranted in global equity investment. There will be a lot of money to be made in these conditions, but timing is important. March 2020 was one of the worst months ever on global markets, but April saw a big bounce back – the best in the past 33 years. The bottom line is that, YTD, the MSCI World Index is down by 12% up to the end of April (with the S&amp;P 500 index down only 9% YTD), which many would consider a far better-than-expected outcome, after the height of the novel coronavirus (CV-19) fears a month or two ago. We believe global equity markets started the year in fully valued territory and, at an index level, with prospects now far worse, markets as a whole are certainly not in value territory. Earnings in 2020 will be under immense pressure and 2021 looks uncertain. Great businesses will rebound to normality in 2021, but some of this is already factored into share prices.



Everyone we speak to both in South Africa (SA) and in the UK have been caught off guard, with the overwhelming majority of those people expecting equities to go lower from here. We note the following:



<ul class="wp-block-list"><li>“no one” is buying the bear market rally.</li><li>US Federal Reserve (Fed) Chair Jerome Powell is pouring cold water on the hopes of a V-shaped recovery by stating that there is “… considerable risks to the economic outlook over the medium term.”</li><li>30mn people in the US are now “unemployed”.</li></ul>



So, how do we play global equity markets?



<ul class="wp-block-list"><li>Do not sell your long-term growth companies.</li><li>In our funds we remain focussed on buying great companies at good prices and these opportunities are presenting themselves. We are excited by these opportunities and we await further pullbacks to increase our exposure.</li><li>Certain sectors of the market will benefit from the events of the past two months and their long-term drivers and trends will be strengthened.</li><li>Among our top holdings are: The Walt Disney Company, Yum! Brands, Nike, Prudential, Unilever, Admiral Group, ICICI Bank, GlaxoSmithKline, Amazon, Ping An Insurance, Johnson &amp; Johnson, PayPal, Royal Dutch Shell and Alphabet.</li></ul>



A recovery portfolio



There are numerous share-specific opportunities which present themselves with the prospects of their share prices rising by 25%-50% in the next 12-18 months. Anchor has been running a “Recovery Portfolio”, which adds to, instead of replacing, a core long-term growth portfolio. The recovery portfolio is dominated by high-quality companies with great track records whose share prices have been hammered. Among these are: JP Morgan, Hasbro, Starbucks, McDonald’s, Paychex, Stryker, Sysco, Leggett &amp; Platt and Ulta Beauty.



So, in global equity markets, there are some great individual opportunities, but our base-case view is that better opportunities might still present themselves and we want to make sure we have cash available to take advantage of these.



Property



Global property is an interesting equation. Many tenants are not paying rent (especially in retail) and people are questioning whether the same amount of office space will be required after the lockdown experience. Global listed property shares have acted similarly to global equities and are down around 20%. The issue with property companies is that, generally, high levels of gearing mean that prolonged periods of reduced turnover can have a significant negative impact on net asset value (NAV) per share. Diversified listed property companies might well be a good way to play a recovery, but it should be restricted to quality plays.



Anchor has significant intellectual capital in the property space, and we are very excited about property over the next few years, especially given what is happening to capital prices. In the physical property space, there is blood on the streets, and it will get worse. Yet property has a powerful role to play in a diversified portfolio – strong, predictable, compounding and growing cash flows are available with the right tenant and leases. While listed shares might be a good way to play the recovery, we believe the direct market will be particularly attractive. The Anchor Tenant team is identifying such opportunities and will present global and local opportunities to investors over the coming months.



Moving to the local market …



SA is in a very different space to developed markets (DMs) where investors can earn a very attractive real return by investing in income and bond products. This means one can be even more patient with equity investment.



The SA market, as measured by the Capped Swix Index, bounced back by 14% in April and for the year to end April the index is down 16%. The direction in SA markets is likely to follow global markets and the rand is expected to weaken if global markets weaken and vice versa. When the world is more comfortable that normality will return in a reasonable timeframe, emerging markets (EMs) are likely to outperform DMs and the rand has the potential to recover materially. It is important to look below the index level and understand the non-SA Inc. shares that have recovered, as opposed to the SA shares. This is not surprising, as the price of many of these shares is set internationally and they have been dragged higher by their international strings.



The SA economy is only one part of the equation



It is vital to remember that, when we talk about the SA market, there is a portion that is sensitive to SA economics and a portion that is not impacted (consider Naspers, British American Tobacco [BTI], Richemont, BHP Billiton, Quilter etc.). In our equity fund, only 26% of our holdings are sensitive to the SA recovery and, despite SA’s poor short-term outlook, we have retained these because they are trading at once-in-a-decade valuations. SA banks and insurance companies are strong, and it appears that more than the worst case is already factored into many of these companies’ share prices.



MTN is an example of a share which we believe has more than 50% upside potential. Mobile telecommunications has been strong sector internationally this year and Vodacom is up for the year. MTN has fallen sharply, largely because of its Nigerian exposure (27% of profits). This contribution will fall, but we still expect it to be positive, and Nigeria is now being valued at zero in the MTN share price



April’s winners



The past month on the JSE was characterised by extreme volatility in those sectors with the highest degrees of operational risk brought on by CV-19 (read SA cyclicals), which, through their volatility continued to disappoint. The winners were more of the same from those sectors that have provided much of the performance contribution of the index over the past 18 months:



<ul class="wp-block-list"><li>Naspers/Prosus (a 2% contribution to the index);</li><li>PGM (2.2%);</li><li>Gold (2%); and</li><li>British American Tobacco (1%).</li></ul>



While we focus on long-term investment in our philosophy, the current volatility and pricing of shares is presenting us with shorter-term opportunities.



In SA equity, our actions have been to increase the defensiveness of the portfolio. This is done by reducing our exposure to those companies with weak balance sheets, which are not yet fully reflected in the share price, and those businesses which face immediate threats to their existence and, where we can, by increasing our exposure to those leading franchises that should emerge from this crisis in a better shape – or at least where we are confident that they will emerge. An interesting observation globally in the March sell-off and the subsequent April rebound was that value tended to underperform growth. As part of our strategy, we think this multi-year growth trend of outperforming value is likely to persist, although we do not manage factors that simplistically at a portfolio level. In the last few sessions in April, we started to see some buying coming in for those names that had been severely sold off over the past six weeks, the more cyclical sectors, with growth underperforming.



Anchor’s buys and sells in April



In the Anchor BCI Equity Fund we were net sellers of The Foschini Group, Nedbank, Bidvest, Home Depot and Discovery. We were net buyers of Growthpoint, FirstRand, Old Mutual, Quilter Plc and Sibanye Stillwater.



The underperformance of the SA economy has resulted in a continued narrowing of the local investible universe, with the index becoming increasingly concentrated to a small number of large caps, mostly exporter/rand-hedge type stocks. In the short term, it is unlikely that this trend will break. However, it is likely that, over the medium term, the underperformance of domestic companies will reach an inflection point and they will return to growth once more – its human nature to extrapolate a negative trend into perpetuity, but it seldom works out that way.



Other EMs



As we look across global markets it is interesting to consider some EMs:



<ul class="wp-block-list"><li>SA (like India), could probably loosen the grip on its lockdown measures in order to save a vulnerable economy. The second-order impacts of the continued lockdown will likely be far worse than the damage caused by the virus itself. We expect positive surprises on this front, with the lockdown likely being softened to allow more businesses to open.</li><li>China: We expect China to keep chugging along, despite the structure of its economy being very different to 2008/2009, so we anticipate the policy response needed to reflect that. Looser monetary conditions should be front and centre. However, the relationship with its biggest trading partner (the US) is rapidly deteriorating and this trend is unlikely to stop anytime soon.</li><li>Brazil: As a country this is not in a great place. Going into the pandemic, Brazil was the big reform story of 2020. However, that has unravelled in dramatic fashion, with political and social unrest due to the country’s right-wing President Jair Bolsonaro’s handling of the crisis. The oil price crashing is also not helping Brazil’s fiscal situation</li><li>Russia will be ok. Going into the oil market collapse the country had been building reserves for all of 5 years. Russia also has no external debt and is running twin surpluses. It is difficult to find a stronger balance sheet from a major economy. The oil price collapse is not good for the country as its biggest export commodity, so Russia will go into a recession but we note that the government has more than enough money at its disposal to stimulate fiscally ($500bn in excess reserves for a start). And, we believe that the oil market will eventually rebalance and find a level higher than where it is now.</li><li>India also has significant social unrest due to the government’s handling of the virus. Like SA, the criticism has been directed at the economic sacrifice brought about by government’s lockdown measures. In our view, it will suffer a recession this year, but India’s banks are in far better shape than a few years ago.</li></ul>



Above all else we need to remember that the world will reopen, life will get back to some form of normality, Super Rugby will return, everything will be OK – the world is just going to have to figure out how to cope with all the extra debt.

Op-Ed: Supporting the ICT sector in Africa as a cure for the economic crisis

Op-Ed: Anchor Capital on how to make money out of equities in the aftermath of the global market collapse

JSE-listed airline, <a href="https://www.cnbcafrica.com/videos/2020/02/27/comair-ceo-on-covid-19-impact-on-business/">Comair</a>, has announced the group will enter business rescue to safeguard the interests of the company and its stakeholders after the <a href="https://www.cnbcafrica.com/videos/2020/05/04/covid-19-lockdowns-when-is-the-right-time-to-reopen-economies/">COVID-19 crisis</a> disrupted the implementation of a turnaround plan.



In its H1, FY20 results Comair reported a half-year loss of R564 million. Although revenue grew by 3%, this was reportedly not enough to offset cost increases of 14% resulting from significantly higher fleet and maintenance costs.



Read the full statement below:



Comair enters business rescue in response to unprecedented circumstances resulting from Covid-19



&#8211; Move aims to restructure the airline as a sustainable business



Tuesday, 5 May 2020: Listed airline company, Comair, today announced the group will enter business rescue to safeguard the interests of the company and its stakeholders after the Covid-19 crisis disrupted the implementation of a turnaround plan.



Comair CEO, Wrenelle Stander, said the company, which reported a half-year loss of R564 million for H1 F20, faced an unprecedented situation following the Covid-19 lockdown.



“While we had started making good progress to fix the financial situation six months ago, the crisis has meant we have not been able to implement it as we intended.



“We completely understand and support the government’s reasons for implementing the lockdown, however as a result we have not been able to operate any flights. Now that the phased lockdown has been extended the grounding is likely to endure until October or even November. These extraordinary circumstances have completely eroded our revenue base while we are still obliged to meet fixed overhead costs. The only responsible decision is to apply for business rescue.”



In terms of the lockdown Comair was required to stop flying on 26 March and has not operated any passenger services since. The Covid-19 crisis has also severely affected the global airline industry. A number of carriers have gone out of businesses. Others such as Virgin Australia and Air Mauritius have implemented restructuring processes, similar to business rescue.



“Comair remains solvent and an important contributor to the South African economy. This is a necessary process to ensure a focussed restructuring of the company takes place as quickly as possible so we can take to the skies again as a sustainable business and play our part in the county’s airline industry,” says Stander.



Shaun Collyer and Richard Ferguson have been appointed as the joint business rescue practitioners with effect from 5 May 2020.



Comair was granted approval to suspend the trading of its shares on the JSE with immediate effect. The business rescue practitioners will provide shareholders and all other stakeholders with further updates throughout the process.



The business rescue process will build on the turnaround plan that Comair management was already implementing. It aims to preserve cash, cuts costs, dispose of non-performing assets and strengthen the balance sheet. The Section 189A process, which was part of this plan and that began on 23 March, will continue.



The business rescue practitioners will work with the management team and the board towards Comair resuming operations in accordance with all regulatory requirements, including the health protocols to prevent the spread of Covid-19. Stander said Comair will resume its operations in accordance with government directives and will continue to engage with government to accelerate the opening of the airline industry.



“The health and welfare of our customers, crew and the public is the overriding priority and we will only operate when we are sure we can do so safely.”



Customers with existing bookings will be able to rebook flights within 12 months of their departure date. There will be no charge for any changes made before 1 November 2020.



“Through this process we intend to right-size our operations to be more efficient, agile and customer-centric. This includes, but is not limited to, reconfiguring our network and fleet mix, reviewing portfolios and joint ventures, increased digitisation of the business and new product development and delivery,” says Stander.



“We are confident that with the work we’ve already done and the support of our stakeholders we will get through this process and will be a more sustainable business, better positioned to continue serving the flying public and contributing to the South African economy.”



The business rescue practitioners will contact all stakeholders and suppliers to plan the way ahead in accordance with the processes set out in the Companies Act.



For more coverage on COVID-19 visit: <a href="https://www.cnbcafrica.com/covid-19/">https://www.cnbcafrica.com/covid-19/</a>

International travel for South Africans is now allowed, this is how it will work

COVID-19: SA based airline Comair enters business rescue

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About 57 per cent of fund managers believe South Africa’s equity market is undervalued, the highest since the 2008 financial crisis. That’s according to research from Bank of America. Most investors see more “buy” opportunities on the market than “sell” and to discuss where these are CNBC Africa spoke with John Morris, Senior Director and South Africa Investment Strategist for Bank of America.

Majority fund managers say SA’s equity market undervalued – survey

South Africa has been ranked first alongside New Zealand, out of 117 countries in the 2019 Open Budget Index (OBI) Survey.



According to the National Treasury, the global results reflect a modest improvement in budget transparency, reversing the decline seen in 2017 results and restoring the upward trend shown since the inception of the survey.



Read the full statement below:



SA TAKES FIRST PLACE IN THE 2019 OPEN BUDGET INDEX SURVEY



South Africa has once again come joint first with New Zealand in the 2019 Open Budget Index (OBI) conducted by the International Budget Partnership (IBP) through an Open Budget Survey. The win is in recognition of the country’s commitment to a transparent budget process. This is a repeat of the result from the 2017 OBI.



Over the years, South Africa has consistently entrenched its reputation as a global leader in budget transparency. This is evidenced in the expansive budget information that is published for public analysis and scrutiny.



Past survey results have been used to identify gaps in budget transparency and informed measures and mechanisms adopted to address those gaps. The reforms implemented between 2017 and 2019 include, among others:



<ul class="wp-block-list"><li>Launch of the online budget portal vulekamali.gov.za</li></ul>



<ul class="wp-block-list"><li>Introduction of a Central Supplier Database and other procurement reforms undertaken by the Office of the Chief Procurement Officer to enhance transparency in bidding for government contracts</li></ul>



<ul class="wp-block-list"><li>Annual budget outreach at institutions of higher learning</li></ul>



<ul class="wp-block-list"><li>Enhanced commitment of the South African Government to engage with civil society organizations to ensure increased participation in the budget process.</li></ul>



SA ranked first out of 117 countries. The global results reflect a modest improvement in budget transparency, reversing the decline seen in 2017 results and restoring the upward trend shown since the inception of the survey. The global average transparency score is 45 out of 100 and South Africa scored 87 out of 100, a score all South Africans should be proud of.



The global average public participation score is 14 out of 100. While South Africa scored 24 out of 100 in this category, it is needless to say that this is a score that requires innovation to improve. In an effort to improve on this score, South Africa in partnership with International Budget Partnership (IBP) and Global Initiative for Fiscal Transparency (GIFT) are embarking on a 3-year pilot project to work on mechanisms to include public participation in the budget process with the assistance of civil society.



The final category is oversight. Out of the 117 countries surveyed, only 34 had adequate oversight from legislature, while 71 had adequate oversight from audit institutions. South Africa scored 75 out of 100 on legislative oversight and 100 on audit institution.



It is clear that achieving first place cannot be a victory for the finance ministry alone but all the institutions that demonstrate commitment to transparency as entrenched in our Constitution.



South Africa remains committed to constantly improving the budget process in order to maintain its international reputation as a global leader in budget transparency even during the global pandemic of Covid-19.



The OBI survey provides a comprehensive review of South Africa’s budget process. Citizens are encouraged to use information published in budget documents for effective analysis and research internationalbudget.org/open-budget-survey.



Issued by National Treasury



Date: 04 May 2020

COVID-19: Investing for Roubini’s Greater Depression

SA takes first place in 2019 Open Budget Index Survey

By Chris Bishop



Amazon has been voted top dog in the competitive world of brands in the Brand Finance Retail 50 survey &#8211;&nbsp; told you so, says the company’s representative in Africa.



The online shopping giant has been cashing in on the COVID-19 lockdown thanks to people’s inability to leave their home and has increased its brand share by 17.5 per cent to be worth $220,791,000. In second place is the US store chain Walmart, up 14.2 per cent with a brand worth $77,520. Industry experts say Walmart was a bit slow off the mark with online sales, but made up for it over the last year.



“Speaking at a conference in South Africa over a decade ago, &nbsp;I said I thought Amazon would become the biggest retail brand&nbsp; in the world. I was then told from the floor that I was wrong, Amazon was not a retail brand. It reminds me that many years ago I was told gently by a top CEO that I couldn’t be right all the time. Very good advice, but there is no harm in trying! Larry Page, a founder of Google, once said that the main reason brands failed is that they were unable to see the future,” says Jeremy Sampson, the CEO of Brand Finance Africa.



“You will see from the annual ranking of Top Retail Brands released by Brand Finance in London this week that Amazon is in a league of its own. Yet some of the traditional retailers, if that is the right term, have remained strong and are adapting. In South Africa, as in most countries there is a long list of retailers who are no longer. The last few weeks has accelerated the use of technology and we will see further shrinking of a bricks and mortar presence. We have a Minister who seems to think technology gives some an unfair advantage. He needs to get real as this is an undeniable fact of life. But we do need to harness technology for the benefit of all.” What the experts can’t work out is why Jack Ma’s baby the online shopping conglomerate Alibaba. The China-based company is hanging on to number 10 on the Brand Finance top 10 brands. Its brand, according to research &nbsp;&nbsp;&nbsp;

Screenshot 2020-05-04 at 11.08.53

I told you so! The $220 million name that means  Amazon is top dog among world brands

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There will be a glimmer of hope in the fight against COVID-19 emanating from the southernmost tip of Africa. The Stellenbosch medical school campus based in Tygerberg Hospital in Cape Town began trials for a booster that could help many people fight disease. Around 500 people are taking part in the trials and if more funding can be found up to 3,000 people could be involved. One of the people behind the trials is Professor Andreas Diacon and joins CNBC Africa for more.

Could the TB vaccine alleviate COVID-19 symptoms and infections?

By Chris Bishop



Fellow prisoners of the late struggle hero Denis Goldberg have told how he worked selflessly to brighten the lives and ease the pain of incarceration for his fellow inmates. Also how he nursed the lawyer Bram Fischer, who saved the Rivonia accused including Nelson Mandela from the noose, through his last painful days.



Goldberg died this week, aged 87, after a life in politics fighting for the betterment of others. It was a long and tireless career that saw him turn his engineering skills into making bombs for the military wing of the African National Congress. Twenty-two of those years of activism were spent in prison in Pretoria serving a life sentence for sabotage handed down at the Rivonia trial.



Sean Hosey, one of the so-called London recruits who helped the South African liberation struggle, spent five years in the same cell block as Goldberg in Pretoria in the late 1970s. He recalls how Goldberg fought a campaign for the prisoners to get newspapers.



“One of the cruellest apartheid prison policies was to deprive prisoners of all current news. No newspapers, news magazines, radio, or any source of current news. Family letters and visits were heavily censored, and not infrequently stopped. Prisoners had to cope with this for many years, with lasting psychological damage, which even now is not fully understood,” recalls Hosey.



“For a period of about 18 months, in 1976-77, Dennis masterminded a campaign to get this information into the public domain and to try to launch a legal challenge in the South African courts. He battled relentlessly to brief a lawyer on the matter, despite harassment, delaying tactics, and threats from the prison authorities. For a variety of reasons, it didn’t get to court, but it did lead to a considerable easement in news deprivation from about 1978. Many ‘politicals’ would be thankful for that.”



Former Pretoria political prisoners also recalled how Goldberg cared tirelessly for the man who had saved his neck in the Rivonia trial – lead counsel Bram Fischer. The authorities, many of whom saw the Afrikaner as a traitor for his part in defending Mandela and his comrades, treated Fischer harshly, even after he was diagnosed with cancer in 1974. Fischer was sentenced to life imprisonment, in 1966, on charges of furthering communism and attempting to overthrow the government. In prison the warders did him few favours.



“In the years I spent there, Bram Fischer was with us until one day he slipped and fell, fracturing the collar of his femur. He was left without treatment for fourteen days,” says former activist &nbsp;Alex Moumbaris, who spent over seven years in Pretoria prison.



Hosey recalled how Goldberg nursed Fischer through his final, painful, days. &nbsp;



“Denis and Bram had adjacent cells in Pretoria Central. Bram developed cancer during 1974. Eventually, he was given treatment, which apparently included radiation therapy. On a number of occasions, he was brought back to his cell in a dazed and confused state and left to his own devices under lock and key, with heavy consequences for his wellbeing,” says Hosey.



“Denis vociferously and consistently raised this with the senior prison officers and complained about Bram’s treatment. After weeks and months of this, Denis was allowed to help Bram overnight, after these treatments, which I know was a comfort to him. Although the vicious regime kept Bram in that cell until days before his death, I believe that Denis’s actions, in the face of threats to himself, helped Bram in his last days.”



On a lighter note, Hosey recalled how Goldberg, who was far from religious, used to see a Rabbi six times a year for what he called philosophical debates.



“However, a bonus to the visits was one of the rare treats that was permitted us – the annual ‘Passover Parcel’. This was a food hamper of appropriate Passover foodstuffs, all of it a delightful delicacy compared to our prison diet,” says Hosey. “Excitement would build for weeks with anticipation, because Denis shared everything the Rabbi brought with the rest of us. I never suggested to him that his ‘philosophical debates’ might have had an ulterior motive! But that was Denis, generous and always supportive of his comrades.”

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