Retailers ready for VAT hike, and the man with the toughest job in South Africa

Markets continued their slow recovery on Monday (14 April) as tensions eased slightly over the United States trade war. The rand pulled back below R19/$ as ructions in the GNU also simmered down.

However, volatility remains the name of the game as uncertainty lingers over what direction the tit-for-tat tariff escalation between China and the United States will take.

Similarly, while the Government of National Unity (GNU) remains intact and talks of booting the DA out or the party otherwise exiting have dissipated, questions remain over the future composition of the coalition.

Markets have shifted from banking on the stability of the GNU to waiting to see what it actually does, with overall sentiment dampened by the impasse over the budget.

On Tuesday, 15 April, the rand was trading at R18.83 to the dollar, R24.89 to the pound and R21.39 to the euro, with the expectation that the local unit will strengthen further.

Global oil markets have also recovered slightly, though the spot price of Brent Crude remains well below the $70 a barrel mark, currently trading at just over $65/bl.

Here are five other news stories making waves in South Africa today.

Retailers get ready for VAT: As political parties try to navigate a way forward for the budget that does not include the 0.5ppt VAT hike, major retailers in the country say they’re ready to implement the price changes come 1 May. While all parties in the country and the GNU are now on board to get rid of the VAT hike, there is legal uncertainty about whether this can be done before the announced implementation date. [BusinessLive]

Toughest job in South Africa: Former deputy finance minister Mcebisi Jonas has been named as a special envoy to the United States. He has been given the unenviable and likely insurmountable task of trying to repair the relationship between SA and the US. The presidency said his priority will be to ‘reset’ relations with the US, not to tackle the Trump tariffs, which are being handled by the DTIC. [Enca]

Devastating mafias: The BEE Chamber welcomed the progress made by the Department of Public Works and Infrastructure (DPWI) in taking on the so-called construction mafia—criminal groups that have been exploiting loophiles in BEE legislation to extort companies. These mainly relate to procurment policies, where the mafias have demanded 30% of construction contracts. [Daily Investor]

Road Accident Fund repeat: The Road Accident Fund (RAF) says it will continue using unsanctioned accounting standards to compile its financial reports, despite objections from the Auditor General of South Africa and several court rulings against their use. The RAF switched over to the accounting standard in 2019, reducing its liabilities from over R300 billion to R30 billion, raising serious questions about the validity of the fund’s financial statements. [Moneyweb]

Disaster high alert: Disaster management authorities in KwaZulu-Natal are on high alert for storms and flooding, after the South African Weather Service issued a level 4 warning for the province. “Disruptive” rainfall is expected across the province in the coming days, with authorities warning of flooding and potential damage to property. Residents have been urged to stay off the road if possible and to avoid crossing rivers and swollen streams. [Enca]