September 30, 2010
I was given a little booklet by Statistics South Africa entitled Stats in Brief 2009, and a very useful little document is is too. Hardly bigger than a Kindle screen, it contains in its 200-odd pages a wealth of statistical data on South Africa, from economic statistics to tourism figures. All the data in this little book is also available on Statistics South Africa’s website, but the book format, with its ease of moving between pages/sets of data, somehow enables you to make connections that are much more difficult to detect while navigating the web. For journalists, it is a veritable treasure trove of potential stories.
For example: on Page 64, you’ll find that there has been no virtually no job growth in the Eastern Cape province over the past nine years. Turn the page, and you’ll notice that there has been about 47% growth in one particular job category: legislators, senior officials and managers. Mmm. Thumb through to the section on municipal expenditure and – my, oh my – the Eastern Cape province spends more on municipal councillors’ remuneration than any other province save KwaZulu-Natal, which has about a third more people. In percentage terms, the Eastern Cape muncipalities devoted 4.4% of their expenditure to councillors’ salaries in 2008, compared with a mere 0.8% in Gauteng, and up from 2.8% in 2001. Now if service delivery only improved at a similar rate…
Kudos to Stats SA for making this sort of informaiton available in such a user-friendly format.
November 9, 2009
After weakening briefly in the wake of the mid-term budget speech, the rand as back to R7.44 per dollar, a rate at which our economy is going to find it very difficult to stage a strong recovery. Lower interest rates made no difference. Relaxing exchange controls didn’t bring about the expected rand-weakening capital outflows. Not even a raft of idiotic policy pronoucements by the likes of Julius Malema, coupled with turf battles between the left and right over who controls economic policy, have dented the currency. What to do now?
Short of firing Pravin Gorhan, making Malema minister of finance, and nationalising the mines and banks, the only answer is: more decisive intervention in the foreign exchange markets by the Reserve Bank. Buy, buy, buy dollars.
October 30, 2009
Never accuse the ANC Youth League of a lack of ambition. In an interview with the Mail & Guardian, secretary-general Vuyiswa Tulelo said the league wasn’t planning to stop at nationalising the mines. The mines are just the first step, she said.
“Later we will look at other sectors, including state-owned enterprises, especially rail and energy.”
Nationalising Eskom and Transnet? I though the trick was getting rid of them?
Tulelo also has advice for those who fret that the state won’t be able to run nationalised industries properly. “If you give people performance contracts, they will be forced to do better.” But that didn’t work for those who are running the soon-to-be nationalised Eskom right now…
October 30, 2009
Perhaps I’m just stupid. But could someone explain to me why food prices are still rising in the supermarkets, while prices at producer level have been falling for months?
According to the latest producer price index, the prices of agricultural products and manufactured food fell in September, in the case of agricultural products for the second month running. The producer price of processed food – that is, the price at which manufacturers supply retailers and wholesalers – is now almost 2 percent lower than a year ago, while the prices of agricultural food products have fallen on average by almost 6 percent.
In the case of some commodities, prices have plunged dramatically. The price farmers get for grain, for example, is now 22.5 percent – almost a quarter – lower than a year ago. And the price of flour is down 12 percent. Yet, in the supermarkets, the prices of bread and cereals have declined only 2 percent over the same period, according to the latest Consumer Price Index.
Let’s get this straight: the farmer is getting 22.5 percent less for his wheat. The miller is getting 12.1 percent less for his flour. The supermarket is charging just about the same for your loaf of bread.
Meanwhile, the supermarkets continue to rake in record revenues, despite the worst recession in decades. How is that possible?
October 5, 2009
This is what passes for political debate in South Africa these days:
We cannot tolerate a situation wherein ugly Zille uses money that is supposed to build toilets to buy her own make-up and Botox. You can’t use that money to buy your Botox, that money belongs to service delivery…
The speaker was Buti Manamela, leader of the Young Communist League, at the launch of the SA Communist Party’s “Red October” campaign in Khayelitsha, Cape Town (read the full report in The Times).
How does he get away with this? And why do senior ANC leaders, such as Education Minister Blade Nzimande and ANC deputy secretary-general Thandi Modise, who were present, allow him to spew such vile sexism? Shame on them.
It is OK to attack the DA’s record in service delivery in the Western Cape. But it is not OK in 21st Century South Africa for a male politician to attack a female politican opponent by calling her “ugly” – especially not one who was in the front of the chorus condemning Zille for “sexism” when she appointed an all-male cabinet. And it is not OK to accuse an opponent of stealing public funds to pay for make-up and cosmetic surgery. That is not only puerile, it is also defamatory, and I hope Zille sues Manamela for every penny he has.
Service delivery? I don’t know if Manamela, Nzimande or Modise read The Times, but if they do, they should turn to page 6 of today’s paper, where they’d see a photograph of a child running through a cess pit of untreated sewage in a street in Ezakheni township, at Ladismith in KwaZulu-Natal. Despite residents’ frequent complaints, the municipality has done nothing to prevent sewage spills like these. This is in an ANC municipality in an ANC-controlled province. Calling Helen Zille names won’t make those people’s lives any better.
September 30, 2009
Economists Chris Malikane, Seeraj Mohammed, Lumkile Mondi and Simon Roberts make an excellent argument in Business Day for Reserve Bank intervention to weaken the rand, something I have also suggested in the past. In brief, their argument is this: South Africa’s relatively high interest rates are attracting large inflows of short-term foreign capital, which are pushing up the price of the rand. The strong rand is having a devastating effect on our manufacturing and export sectors, stalling any possibility of a strong economic recovery. The Reserve Bank can push down the price of the rand by aggressively buying dollars to add to its foreign reserves, but won’t, because, it argues, that would inject money into the local economy, increasing the money supply and causing inflation – unless the bank “mops up” the extra liquidity by issuing bonds. This it doesn’t want to do, arguing that the interest payments on the bonds are expensive, and that government debt issuance to finance the budget deficit would also become more expensive.
That is a fallacious and outdated argument, according to the writers of the Business Day article:
Adherents to a version of monetarism that was discredited 20 years ago think that increasing the money supply will just lead to increased inflation. But, it is clear that right now there is no problem with increasing the local money supply. The commercial banks have stopped lending, and the stock of debt in nominal terms has been static since last year. The tightness in giving new credit is compounding the crisis as firms require greater working capital to deal with difficulties of weak demand and nonpayment by customers, and households need to roll over some debt. Some commentators have been calling for “quantitative easing” — increasing the money supply to encourage banks to lend once again — that has been key to the response to the crisis in industrialised economies.
Morover, the Reserve Bank’s position ignores the cost of not acting to weaken the rand: “jobs and livelihoods accross the economy”.
It seems that the Washington Consensus has fallen by the wayside everywhere else in the world, but at the southern tip of Africa we still cling to it…