Month: February 2021

Q1/2021: Economic Highlights for Business Strategy

Executive summary The lockdown risk we warned about in November was unfortunately realised in December and January, globally and also domestically. Global economic restrictions have caused renewed disruptions to production and trade activity. Combined with domestic restrictions to the tourism, restaurant, entertainment, and alcohol sectors, foreign restrictions have caused the domestic recovery from H2 2020 […]
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Expropriation Bill rife with constitutional concerns, threatens security of property – Sakeliga

The Expropriation Bill’s attempt to gain the power to expedite and make easier to wield, government’s power to expropriate private property, should be strictly limited and circumscribed. The bill should honour property rights and limit State power.   These were some of the appeals in business organisation Sakeliga’s extensive comment on the controversial bill, which was submitted this week as part of the public participation process.  Piet le Roux, CEO of Sakeliga, said the bill should be aligned […]
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Budget still projects deficits up to 3.5 times that of Zuma era; Sakeliga report gives 30/100 for policy reform – Sakeliga-ETM economic update (quarter 1 2021)

“The alarming bottom-line of Mr. Tito Mboweni’s 2021 budget is that its projected deficits range between 2 and 3.5 times compared to those of the final days of the Zuma era. From the point of fiscal and economic sustainability, Mr. Mboweni’s latest budget is therefore at least twice as concerning as those of former Minister of Finance Malusi Gigaba. The increase in expenditure and debt must, however, not be laid at the feet of Mr. Mboweni, but at those of government for its failure to implement the required structural and policy reform,” says Piet le […]
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“Only R1.2 million” – government doesn’t understand its own BEE policy

The new Employment Equity Amendment Bill was recently published for public comment. Besides the already-well-documented problematic nature of government’s racialised empowerment policy, it is becoming increasingly clear that government has no inkling of the devastating consequences this policy has on South Africa’s economy or society.  Opponents of racial empowerment policy might be quick to proclaim that of course government does not understand, as they have been pressing ahead with it […]
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SONA: No structural reform, state recommits to interventionism

Despite dire need, tonight’s state of the nation address did not announce the required structural reforms. As difficult as it is, real reform by President Cyril Ramaphosa would have had to start with an acknowledgement that government policy is the main cause of South Africa’s economic crisis. It would have had to outline an alternative vision of less politics, more business. Instead, the President recommitted his government to […]
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Economic and social recovery requires more; reform should feature in state of the nation address – Sakeliga

Business is relieved by the lifting of some lockdown regulations, even if insufficient, but remain concerned about remaining or reinstated regulations. The threat of future lockdown measures will, until greater certainty prevails, discourage businesspeople from investing and resuming operations.   In the meantime, the government’s commitment to detrimental and divisive politics is causing great harm. Restaurants on the verge of collapse are being forced to pay higher wages. Government is now also openly providing relief for businesses […]
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