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Opinion Poll - Do you think that SA's economy will survive 2008??

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14 REPLIES 14
Big_Bucks
Super Contributor
Absolutly YES, Problems are just an obsticle in our daily lives that we all can and will overcome, remember the water shortage?. Now our dams are overflowing. If escom needs 10% to manage and pevent load shedding, it is a sacrifice we can all make with very little inconvienence, let's face it we all waste electricity including big business.
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Wumpus
Frequent Contributor
I'm so tired of hearing how we have the save electricity - while the universe is waisting the stuff away. I think the aim should be on supply rather than focusing solely on demand. There are so many units and stations that are merely standing still and not producing (due to lack of maintenance, etc...). What about finding new inuvative ways to genertate electricity rather than trying to manage the demand? ...or are their some brain-dead policitical motive that boycots the implementation of such ideas? I also don't buy the skills shortage: there are an ample supply of qualified engieers in the industry (or are they too pale?)
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topgun
Super Contributor
Absolutely No Clue - "go to bed early so that you can grow and be cleverer" is clearly not working for some....vote with all your switches on....one man, many switches. lol
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Not applicable
YES, I am waiting patiently for Trevor's announcement, at some point production will stabilize and due to the failling rand, south african products will look attractive, even with the energy crises our current account deficit will decrease substansially.
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Russ
Super Contributor
I can see where this is heading-one man,one volt.
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Ega
Super Contributor
Wampus, you're perfectly correct about the availability of skills however your post reminds me of an e-mail received from an Eskom employee while doing my own investigations, which read;

SICS MUNCE AGO I CUDDINT IVEN SPEL INJINEER AN NOW I ARE ONE

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Brazen
Super Contributor
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SICS MUNCE AGO I CUDDINT IVEN SPEL INJINEER AN NOW I ARE ONE that just sounds wrong, think about what you say and where u say it? we are all frustrate about electicity. no matter what race we are, we hate seeing and feeling this negative sentiment. if you want to challenge skill capacity of eskom staff, try and find other ways to do so. but this is wrong, wrong.
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Not applicable
Universe? If you are suggesting nude sunbathing, I'm all for it.
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Ega
Super Contributor
Thamil, this was a plaque I had up in my own office when I worked for Eskom - it does not intend to belittle anyone, niether is there any inference to race - mixing up of am, are and is is normally attributed to Afrikaans speakers (I am both, Scots father and Afrikaans Mother). Normally a persons self esteem is firmly grounded to the extent that they are able to laugh at themselves. A nation which looses this ability would not be worth being a part of.

I am well aware of the positive steps Eskom and the Goverment have taken to rectify this oversight, new power stations such as Medupi etc only bodes well for our future and that of the economy.

You only need to think of where the nursery rhyme "Ring a ring of rosies, a pocket full of posies, ...." originates from to appreciate the need to keep our people smiling.

I see the good in everything...
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Russ
Super Contributor
Noboddie on this forim can spel anyweigh butt I dont larff at enniewun,not eevin afrikaaners and skotts.Thamil tell if things improove at eskom.They shood recroot heer as we hav a lot of injineers on this forim.I dont larff at injineers,they arr fine peepil.
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Not applicable
Chaps I know that we've got a lot to talk about but the question still remains . Does our children have a future in this country??
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john_1
Super Contributor
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Rand Sinks as South African Electricity Grid Fails (Update1) By Lukanyo Mnyanda and Garth Theunissen Feb. 11 (Bloomberg) -- Gold is above $900 an ounce and platinum has never been higher, yet traders are selling the South African rand faster than any other major currency because President Thabo Mbeki can't keep the lights on. The rand is down 12 percent this year against the dollar, six times more than the next-worst performer among the world's most widely traded currencies. UBS AG forecasts the sharpest drop in the rand since 2001 this year, and option prices show it has the worst prospects of any currency. The decline signals the world is losing confidence in South Africa's ability to remedy a power shortage that has disrupted mining of some of the world's most valuable precious-metals deposits just when prices are climbing. Mbeki, the 65-year-old successor to Nelson Mandela who has presided over nine years of economic growth, steps down in 2009, and the man most likely to replace him, Jacob Zuma, is due to stand trial this year on charges from fraud to tax evasion. ``The currency is the share price of a country,'' said George Glynos, managing director of Johannesburg-based Econometrix Treasury Management, which advises investors on bond and foreign-exchange holdings. ``If anyone wants to know what foreigners are thinking about South Africa at the moment, they need look no further than the rand.'' The rand fell 6 percent to 7.81 per dollar last week, the largest weekly drop since June 2006, and weakened a further 0.6 percent to 7.83 as of 9:50 a.m. in Johannesburg today. Zurich- based UBS, the world's second-biggest currency trader last year with almost 15 percent of the market, according to Euromoney Institutional Investor Plc, forecasts continued ``rand weakness.'' `Fall Sharply' State-owned Eskom Holdings Ltd., which supplies 95 percent of South Africa's power, cut electricity to businesses last month, and most of the country's mines had to shut for five days. Eskom says the government ignored repeated calls to invest in the electricity grid, and it won't be able to increase generation capacity until 2013. ``If the gold mines stay shut, the rand is going to fall sharply,'' said Werner Gey van Pittius, a currency manager in London at Investec Asset Management, which oversees about $60 billion in assets. ``Our strategy is simply to be long the good stories and short the bad stories. And South Africa is definitely not one of the better stories.'' `Irritated Chief Executives' Melbourne-based BHP Billiton Ltd., the world's largest mining company, said Eskom told it to cut electricity usage at three aluminum smelters by 10 percent. Johannesburg's AngloGold Ashanti Ltd., Africa's biggest gold miner, said last week it will lose 400,000 ounces of production in 2008. The company produced 1.37 million ounces last quarter. Harmony Gold Mining Co., the No. 3 gold producer, lost 300 million rand ($38 million) of production during the five-day shutdown alone. ``There are some rather irritated chief executives,'' said Amelia Soares, investor-relations manager at Johannesburg-based Harmony Gold. ``It's a serious situation.'' Sandton City, South Africa's most-expensive shopping center, was left without power for an average of 4 1/2 hours a day between Jan. 13 and Jan. 20. The center in northern Johannesburg is considering buying an 80 million-rand generator. ``It has really affected us, especially in the month of January,'' said Emmual Human, manager of the center's Mont Blanc boutique, which sells luxury goods from jewelry to handbags. ``In the initial days of the power cuts we saw an 80 percent drop in turnover.'' `Tragedy' Precious metals and minerals account for about 60 percent of South Africa's exports, according to the nation's revenue service. It contributes 10 percent of the world's gold and about 80 percent of its platinum. Gold jumped 11 percent this year to above $900 an ounce, after gaining 31 percent in 2007. Platinum surged 24 percent to a record $1,893 an ounce. ``It's a tragedy that the country is not benefiting from these record commodity prices,'' said Michael Keenan, a currency strategist in Johannesburg at Standard Bank Group Ltd., Africa's largest lender. The rand will fall 5 percent to 8.20 per dollar before the end of 2008, he said. Traders haven't been more bearish on the rand since May 2006. The difference in the cost of one-year rand ``puts,'' which grant the right to sell the currency, and ``calls,'' which allow for purchases, is 5.3 percentage points, up from 3.5 points at the beginning of the year. That's more than any other emerging market currency, according to data compiled by Bloomberg. Eskom a `Symbol' ``The outlook for the rand has changed dramatically in the past month'' said Leon Myburgh, a fixed-income strategist for Africa at Citigroup Inc. in Johannesburg. Mbeki, a member of the ruling African National Congress, apologized to Johannesburg-based Eskom in December for failing to heed the utility's warning in 2000 that it needed to start increasing generation capacity, the South African Press Association reported at the time. ``The Eskom crisis has been symbolic of Mbeki's style of management and his refusal to listen to others,'' said William Gumede, author of ``Thabo Mbeki and the Battle for the Soul of the ANC.'' ``There was a centralization of power and not enough coordination of policy implementation. It meant if something went wrong, it was going to go really badly.'' Growth Forecast Mbeki sought to allay concern about a slowing economy in his state-of-the-nation address on Feb. 8. ``I am aware of the fact that many in our society are troubled by a sense of unease about where our country will be tomorrow,'' Mbeki said. ``I am convinced that the fundamentals that informed our country's forward march in the last 14 years remain in place.'' JPMorgan Chase & Co. cut its 2008 forecast for South Africa's economic growth last week to 3.7 percent from 4.4 percent. It would be the smallest expansion in five years and follow an estimated 4.7 percent rate in 2007, according to the New York-based securities firm. The 5.4 percent in 2006 was the fastest growth in 25 years. Even the government said it's unlikely to achieve a growth target of 6 percent for 2010 as it seeks to cut an unemployment rate of 25.5 percent, the highest among the 61 economies tracked by Bloomberg. Growth during the decade before the end of apartheid in 1994 averaged 1 percent a year. The economy has expanded every quarter since the final three months of 1998. Current Account Foreign investors reduced their holdings of South African stocks and bonds by almost 19 billion rand so far this year, according to data from the nation's stock and bond exchanges. That compares with combined net purchases of 65.5 billion rand for all of 2007. South Africa's government debt has lost 0.4 percent this year, while U.S. Treasuries gained 2.7 percent, according to Merrill Lynch & Co. indexes. When the rand's decline is taken into account, the loss on South African notes is 13 percent. The prospect for further losses may make it more difficult to fund a current account deficit that expanded to 8.1 percent of gross domestic product in the third quarter, the widest in 25 years. South Africa needs to attract 3 billion to 3.5 billion rand a week through foreign investment to finance the deficit, the broadest measure of trade in goods and services, according to Jeff Gable, head of Absa Capital Research in Johannesburg, a unit of the South African bank controlled by Barclays Plc. Interest-Rate Advantage The weakening rand fuels inflation, which accelerated to 8.6 percent in December, exceeding Reserve Bank Governor Tito Mboweni's target of 3 percent to 6 percent. ``The power outages will probably lead to a decline in growth, and the supply constraints can push'' inflation higher, said Tim Haaf, a fund manager in Munich for Pacific Investment Management Co., which manages the world's biggest bond fund. ``That in itself is not a good combination,'' said Haaf, who added that he's holding South African assets, rather than adding or selling. The economic slowdown may not be severe enough to justify a prolonged decline in the rand, said Elisabeth Gruie, an emerging-markets strategist in London at BNP Paribas SA, France's largest bank. While global financial markets are in turmoil because of losses on securities tied to U.S. subprime mortgages, once that's over, interest rates at 11 percent may lure investors, she said. ``Obviously there is some negativity, but the economy hasn't come to a standstill and it still has a growing interest- rate differential with the U.S. and other major currencies,'' said Gruie, who predicts the rand will weaken to 8 per dollar before recovering to 7.1 by the end of the year. ``It could be expensive to be short the rand for too long.'' Zuma Trial Overshadowing any recovery is the prospect of Zuma, a 65- year-old former ANC military operative with no formal education, becoming the country's next president. The ANC's conference in December elected him leader, putting him on course to replace Mbeki after general elections are held next year for the fourth time since the end of white rule. Zuma will go on trial in August accused of fraud, money laundering, racketeering and tax evasion. He was fired by Mbeki as deputy president after he was implicated in the corruption trial of his former financial adviser. He was acquitted last year of raping an AIDS activist. He testified in his trial that he had consensual sex with the activist, who is HIV-positive, without a condom and showered afterward to minimize his chance of contracting AIDS. ``Zuma winning the ANC nomination is what got the ball rolling'' against the rand, said Paul Barrett, chief foreign- exchange trader in New York at JPMorgan's private bank, which oversees about $430 billion. ``The power failures are making people concerned about the prospects for foreign investment.''
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