5 things you need to know about in South Africa today
·31 Aug 2016
Here’s what is happening in and affecting South Africa today:
- It has been suggested by certain ministers that the Reserve Bank be stripped of its power to licence banks, and for that role to become the responsibility of the minister of finance. Certain heads in government are not happy with the way four major banks rejected the Gupta family and its businesses. The Reserve Bank is privately owned, and was fingered by ANC deputy SG Jesse Duarte as a cause for the rand’s volatility.
- Eskom has finally decided to comply with Treasury’s request for information into its contracts with Gupta-owned Tegeta Exploration, after Public Enterprises Minister Lynne Brown ordered the group to do so. Eskom handed over the report without board approval. According to Treasury, Eskom has been frustrating the process for over three months – a claim which the power utility denies.
- South African Airways has received and extension to submit financial reports to Hong Kong, giving the airline more time to secure its routes to the destination. The group is looking to consolidate its debt, and it seeking R16 billion to keep flying. It says it does not need a guarantee from Treasury and will manage on its own. The deadline for its much-delayed financial report is 15 September 2016.
- State-owned arms manufacturer Denel has entered the fray in the ongoing battle between National Treasury and other state branches, such as Eskom and the police. Denel has accused Gordhan and Treasury of wasting money on court battles to stop its (Denel’s) deals with Gupta-linked company, VR Laser Asia. The statement comes as ANC SG Gwede Mantashe asked everyone to keep their spats out of the public eye.
- South Africa’s rand weakened against the dollar on Tuesday, with investor caution over a political row involving the country’s finance minister hanging over the markets. On Wednesday, the rand was trading at R14.49 to the dollar, R18.97 to the pound and R16.16 to the euro.
In global news: Asian shares eased on Wednesday following modest losses on Wall Street, with investors awaiting U.S. jobs numbers for further signs the Federal Reserve may raise rates as soon as September.
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