News Flash – South African Elections on the Horizon

News Flash – South African Elections on the Horizon

In South Africa, the campaigning to the lead up to the general election on the 8th of May is getting heated.  There is concern over the election results as it is unclear whether the ANC will gain strong enough support from voters  in order for President Ramaphosa to stave off the factional opposition within his Party to be able to introduce and execute on much-needed structural reform; to pursue high-level prosecutions against those senior officials suspected of serious charges of corruption; and to make positive changes to the Cabinet.

Global News

Local News 

  • In the lead up to the South African elections, follow this link for an article from the Daily Maverick where Reg Rumney discusses the economic policies in the election manifestos of the ANC, DA, and EFF and what they say about how the respective parties will manage taxes, government spending and debt, and interest rates.
  • The South African Government granted Eskom an R5bn bailout on Friday last week, which punished the rand as concerns are rising that Eskom will bankrupt itself in the ten days leading up to the national elections. Eskom’s open-cycle gas turbines are operating continuously, the Mail & Guardian understands, running up a significant bill burning diesel to keep the dark at bay. The plants are meant to help meet peak demand in times of constrained electricity supply.
  • In March, South Africa’s Producer Inflation increased to above 6%  this is the highest level since the fuel price reprieve in November 2018.
  • South Africa’s consumer confidence dropped by two points as households contend with higher overhead costs and higher taxes.
  • Parts of South Africa have been experiencing extreme weather over the last week, this has caused flash floods in KwaZulu-Natal. So far 67 people have been reported to have died. Follow this link for more information on the damaged caused.
  • After the persistent efforts of the Public Protector, Busisiwe Mkhwebane, to bring Pravin Gordhan down, Gordhan has gone on the offensive with a statement to the media from his lawyers regarding the questionable conduct of Mkhwebane. Follow this link for more.
  • Dynasty was cautious about last year’s Ramaphoria which the country experienced after President Zuma was removed. We now have a far better idea of how much needs to be done to combat the decay wrought by Zuma’s presidency and the time and effort it will take to correct the damage. We, therefore, continue to maintain our strategy of heavy offshore exposure for our clients as we feel that this is the most appropriate means of preserving the hard currency integrity of their wealth.
Source: Dynasty, Stanlib, Prescient, Daily Maverick, Moneyweb, Reuters, RMB, Aljazeera, and Bloomberg Markets, etc

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