Here’s what is happening in and affecting South Africa today:
- The Banking Association of South Africa has met with ministers and says its members are willing to help out South Africa’s struggling SOEs with “expertise and resources”. If companies like Transnet or Eskom were to default on their debt, it would have catastrophic consequences for the South African economy. [Mail & Guardian]
- Despite the weaker rand, economists believe that a rate hike for South Africa is unlikely to happen in 2018. South Africa’s currency has lost 9% against the dollar, year-to-date, in the wake of crashing sentiment around EMs, and poor local data. Economists believe, however, that the rate will stick at 6.5% until 2020. [Reuters]
- Foreign investment in South Africa has dropped to its lowest levels in 2 years, new JSE data shows. While investors plied into SA in the wake of Cyril Ramaphosa taking up the presidency in March, a general sell-off in emerging markets has seen those figures slump. Net foreign investment was at R56.5 billion in May. [Bloomberg]
- Joburg’s landfills are reaching capacity, as 2,500 tonnes of rubbish gets dumped each day. At current rates, it will take just 3 years to hit the limit. From 1 July, Joburg residents will be compelled to start separating their trash in a bid to get up to 30% of trash recycled (from 10% at the moment). [EWN]
- South Africa’s rand retreated by more than one percent on Monday, while shares also wilted over resurfacing worries of a global trade war dented demand for riskier emerging markets. On Tuesday the rand was at R13.52 to the dollar, R17.96 to the pound and R15.83 to the euro.