An economic review of the past week

Published Mar 3, 2018

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JOHANNESBURG - This week saw the National Assembly adopting a motion to to expropriate land without compensation. 

The motion, tabled by EFF commander-in-chief Julius Malema, was adopted with a vote of 241 in support, and 83 against, and the only parties who did not support it were the DA, Freedom Front Plus, Cope and the ACDP.

The matter has been referred to the Constitutional Review Committee expected to report back to Parliament by August 30.

Some stakeholders reacted in the negative to the news, with agricultural union Tau-SA, saying its executive committee “considers the decision of the National Assembly to amend the Constitution to allow expropriation without compensation, as legitimising theft and the commencement of a process of nationalisation of land and property”.

Tau-SA president Louis Meintjes said: “The government must take note that they should expect many farmers to regard it as a declaration of war. Nobody stole the land. It was bought and many mortgages have been or are still being paid for with heavy interest, and worked from sunrise to sunset be able to make payments and to make sure that there is food on every table. Nobody will give ... away their land, regardless of the country's Constitution. Theft remains theft, even if it is authorised in a constitution.”

President Cyril Ramaphosa has stressed that land expropriation would be handled in such a manner as to avoid undermining the economy, agricultural production and food security.

The agriculture sector is crucial as it helped South Africa clamber out of a technical recession last year.

This was acknowledged by Ramaphosa during his recent State of the Nation Address, whereby he said the sector presented one of the greatest opportunities to significantly grow the economy and create much-needed jobs.

Earlier this week, South Africans and indeed the markets were on tenterhooks  as they waited for Ramaphosa’s late night cabinet reshuffle on Monday, where he wielded the axe on 10 ministers and three deputies who served under the alleged kleptocratic regime of Jacob Zuma.

This led to the JSE closing marginally higher on Tuesday as the banks and retailers led the gains following the overnight reshuffle, which received mixed views from stakeholders.

The Rand also reacted positively to the much-awaited reshuffle - at one point trading at a high of R11.55/$ - as respected beancounters Pravin Gordhan and Nhlanhla Nene returned to key positions in the economic cluster.

Those who got the boot include the Gupta-linked Mosebenzi Zwane, David Mahlobo, Lynne Brown, Faith Muthambi, Des van Rooyen, and Nathi Nhleko, Fikile Mbalula, Joe Maswanganyi, Bongani Bongo and Hlengiwe Mkhize.

Ramaphosa’s key announcements included the return of Nene to his previous portfolio job as finance minister; ANC national chairperson Gwede Mantashe (Mineral Resources), Gordhan (Public Enterprises), Jeff Radebe (Energy), and Bheki Cele (Police). Derek Hanekom also returned to his previous job as tourism minister, while Dr Nkosazana Dlamini

Zuma was appointed minister in The Presidency responsible for planning, monitoring and evaluation. 

ANC Women’s League president Bathabile Dlamini, was moved from the crucial social development ministry to become minister in The Presidency responsible for women. 

Her critics, who accused her of enabling the social grants crisis, regarded her new portfolio a “useless ministry” and viewed her appointment as a demotion.

Four days after being axed as public enterprises minister, Brown quit as ANC MP on Thursday and her resignation was confirmed by ANC Chief Whip Jackson Mthembu.

Brown had a tumultuous time in her portfolio as she was implicating in serious allegations of state capture and mismanagement of Eskom, Denel and Transnet.

Meanwhile, on Friday Steinhoff International's share price plummeted 18 percent after reports emerged that  Steinhoff accounts were tampered with dating all the way back to 2014. 

According to a report by a German newspaper, Norddeutscher Rundfunk , former Steinhoff chief executive Markus Jooste, who resigned in December after the accounting scandal emerged, discussed how to manipulate accounts for the 2014 fiscal year, the German newspaper said, citing internal emails.

- BUSINESS REPORT 

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