Wednesday, May 10, 2017

Zuma's attack on capital is digging South Africa into a deeper hole

South Africa’s governing party, the African National Congress, is adopting a dangerous political approach used in failing states like Algeria, Zimbabwe and Venezuela. Its aim is to deflect attention from its policy failures and from numerous scandals surrounding President Jacob Zuma, his family and the politically connected Gupta network. The Conversation

The approach was allegedly crafted by Bell Pottinger, a London based public relations firm. It focuses on two concepts.

The first is the term “white monopoly capital”. The phrase broadly refers to control of the economy by apartheid beneficiary capitalist oligopolies at the expense of South Africa’s black majority.

Accompanying it is the term “radical economic transformation”. This is defined differently by various senior government officials. But is understood to mean rapidly changing the economy’s ownership, control, and production patterns in favour of the previously disadvantaged.

However, beyond damaging South Africa’s social fabric, framing the country’s current economic impasse in such a dichotomous politically charged way has negative consequences.

Firstly it distracts attention from the private sector’s real sins. This makes it more difficult to objectively hold business to account for its own nefarious activities. These include tender fraud, collusion, price fixing, fronting, illicit capital flows and tax evasion. Framing the discourse as “white monopoly capital” muddies the waters. It becomes unclear whether exposing private sector crimes is merely a politically motivated assault, or an attempt to uphold the law.

Secondly the ongoing rhetoric will further damage the chances of economic recovery. This is because it will deter long-term domestic and international investment. It will also encourage companies to move their capital elsewhere and use complex tax avoidance mechanisms.

Thirdly trumpeting vacuous slogans is also unlikely to raise the prospects of credible policies that will deal with the country’s structural challenges.

Populist slogans don’t fix structural challenges


Over the last two decades South Africa has failed to modernise its labour and education systems. This has meant limited success in rolling back poverty, inequality and unemployment. As a result the country has one of the highest unemployment rates and gini coefficients in the world.

The structural problems in the education system have resulted in poorly prepared senior school and university graduates. This is despite the number of children attending school increasing exponentially since compulsory education was introduced in 1994.

Consequently, the country is poorly positioned to take advantage of the “fourth industrial revolution”. This is broadly understood as a range of new technologies that fuse the physical, digital and biological worlds.

Making things worse is the failure to adopt industrial policies to diversify the country’s export mix away from commodities to more sophisticated beneficiation and manufacturing activities. Commodities such as gold, platinum and coal, thus continue to comprise a significant portion of the country’s export earnings.

Although the services-based sectors have given rise to an emerging middle class, this new wealth is largely debt-fueled and consumption driven. This limits savings, capital accumulation and class mobility for most of the population.

What’s at stake


In mid-2017 the rating agency Moody’s will review South Africa’s sovereign credit rating. This comes after two recent downgrades by global credit rating agencies S&P and Fitch.

A great deal hangs on Moody’s decision. If it downgrades the government’s rand-based bond credit rating two notches to junk status, the country will be expelled from the World Government Bond Index. This will compromise its credibility as an investment destination. It will stimulate significant capital flight as international bond funds with investment-grade mandates are forced to sell off South African sub-investment grade bonds.

The rand will then depreciate and the trade deficit will widen. The central bank could then be forced to hike interest rates to curb inflationary pressures. Unemployment will rise and the government’s fiscal slack will be further depleted.

A downgrade of the rand denominated bonds would spark economic instability, and potentially significantly weaken the country’s private sector. The country’s politically connected elite could respond to this crisis by seeking to consolidate political power. This could be achieved using “radical economic transformation” to decimate the vestiges of “white monopoly capital.”

In the wake of the recent downgrades, some politicians have been peddling an illusion that the country’s current woes are simply “short-term pain for long-term gain” for the majority of South Africans.

But the experiences of numerous countries have shown that there is no gain from going down the populist economic path – only state failure.

There are tentative signs that this risk is beginning to take hold among some ANC leaders. Even Zuma’s newly appointed Finance Minister began watering down the term “radical economic transformation” at the recent World Economic Forum Africa gathering. Instead he opted to use the phrase “inclusive growth”.

What needs to be made clear is that the debate around “white monopoly capital” and “radical economic transformation” is about much more than statistics and definitions. It is about the ownership and control of both public and private capital by a politically connected elite. Thus it comes with the potential risk of turning South Africa’s entire economy into a centrally controlled patronage network.

Sean Gossel, Senior Lecturer, UCT Graduate School of Business, University of Cape Town and Misheck Mutize, Lecturer of Finance and Doctor of Philosophy Candidate, specializing in Finance, University of Cape Town

This article was originally published on The Conversation. Read the original article.

Zuma abroad while South Africa is burning

While the country is wavering on the verge of total anarchy with violent protests, the country’s president went to visit another state in Africa instead of paying attention to the restoration of law and order in the country.



Jacob Zuma is currently visiting Tanzania to strengthen mutual relations with the country.

It follows Zuma’s refusal this weekend to visit Vuwani, fearing that he would be mocked in the same manner following a meeting recently held in Bloemfontein.

In Richards Bay, police vehicles were pushed by bulldozers while apparently millions of rands of damage at the port incurred.

In Eldorado Park, residents clash with police for a second day, regarding the high unemployment and lack of housing.

In Coligny, white houses have been burned down after the court granted to two farmers bail, schools are disrupted, and pupils cannot attend.

In Natal, some schools were burnt by informal dwellers.

Vuwani remains a violent district over the incorporation of the area into another municipality.
Port Elizabeth is being rocked by riots and roads are blocked.

In virtually all of the areas affected by violence, it seems that the police are unable to maintain law and order.

Read the original article in Afrikaans on Die Vryburger
South Africa Today – South Africa News

Advancing Human Rights and Sustainable Philanthropy





Craig Featherby
South Africa recently celebrated Human Rights Day. This day certainly deserves celebration; also referred to as Heroes’ Day, the event ignited global awareness of the inhumanities of the apartheid regime and simultaneously signaled the start of a new era of democracy – moving forward with hope.

It is only fitting that reference to this day of commemoration instantly brings to mind Chris Bertish’s recent (seemingly impossible) achievement, aimed at raising 20 million ZAR for three life-changing South African charities: The Lunchbox FundOperation Smile SA and Signature of Hope Trust.

A true modern day hero, Chris completed the first ever solo, unsupported, transatlantic stand-up paddleboard (SUP) Crossing on 9 March, after spending 93 days surmounting the dangers of the open ocean. On 14 March, a motion was put before the Parliament of the Republic of South Africa to congratulate Chris and call on all South Africans to “Dream It, See It, Believe It, Achieve It” (Chris’s motto).

As proud title sponsor of The SUP Crossing, Chris and Carrick share a strong drive to make a difference in the lives of vulnerable children in Southern Africa. Chris’ mental fortitude and determination resonate with the Carrick ethos – as leaders in wealth and capital management, Carrick Wealth is also driven by the values of integrity, transparency and courage even in the face of adversity. It is not surprising that upon meeting Chris just over a year ago at the company’s annual conference themed “Finding courage” that an official partnership was created and cemented.

“Knowing Chris, I’m convinced that he’ll be first to emphasise that while his accomplishments have been vast, he is an ordinary man whose extraordinary dreams have launched him into the public eye, all the result of his burning compassion for the plight of the helpless; his unbreakable spirit and belief in achieving against the odds; and most of all his unwavering courage and grit.”, explains Craig Featherby – CEO, Carrick Wealth

The wise words of the late South African president, hero and father of a nation, Nelson Mandela, inspire us all to strive for greatness: “Courage is not the absence of fear [but the triumph over it]; it is inspiring others to move beyond it”.

Against this background, it’s vital that we take a moment out of our busy schedules to reflect on the future of philanthropy. The term Philanthropy originates from the Greek term which directly translated means “love of mankind.” Philanthropy is an idea, event, or action that is done to better humanity and usually involves some sacrifice as opposed to being done for a profit motive.
In the world of philanthropy, it is relatively easy to donate a large sum of money to make an impact on one or more people’s lives as a once-off event. The much harder part, in fact, ten times harder, is to sustain the same impact into the future. While rejoicing in the excitement of Chris’ impressive feat, it hardly means our work is done; to the contrary, the hard, gritty work starts now. The SUP Crossing has created a solid platform and garnered important public awareness, yet needs to be sustained into the future, mobilising business leaders to continue boosting not just civic awareness but also civic engagement.

In answer to the need for sustainable sponsorship, The Signature of Hope Trust was initiated by four goal-driven achievers who all share the same vision of philanthropy (also directors of the Carrick Wealth Board).

Signature of Hope raises funds through personal and corporate donations: in cooperation with professional partners, the Trust will be building, equipping and administering schools in rural areas of South Africa to provide pre-school education. The Signature of Hope Trust, through Carrick Wealth, will invest the funds raised to support the work of Operation Smile, The Lunchbox Fund and future partners. The funds raised through the SUP Crossing will go into an annuity and the income from this annuity will be dispersed equally to the beneficiaries.

With rising deprivation, environmental stress and injustice all over the world, doing good and giving back to the community gives purpose to people, which is why I am encouraging fellow business leaders operating in the philanthropy space to join the discussion.

Donald Trump believes road tolls are ideal for infrastructure finance – so should South Africa


US President Donald Trump made a point in his inauguration speech to emphasise his election pledge to spend $1 trillion on infrastructure investment over 10 years. He has repeatedly promised to “rebuild our highways, bridges, tunnels, airports, schools and hospitals”.

In his inauguration address, the Republican president said the nation’s infrastructure “has fallen into disrepair and decay”. Those words could just as easily have been applied to South Africa’s infrastructure, and that of many other countries. South Africa is not alone in facing an infrastructure backlog. Rapid wealth accumulation and assets such as cars, as well as a far more mobile population, in many countries means their infrastructure is as inadequate as ours.
Corporate South Africa is currently flush cash, sitting on more than R725 billion balance sheet cash. It’s obvious South Africa Inc is on a long-term investment strike – at home, at least. It’s possible Trump could be the key to unlocking these corporate balance sheets. It is evident that business will be prepared to invest in the local economy where incentives are in place to overcome other concerns. We already have templates of successful Public-Private-Partnerships (PPPs) in several sectors of the economy. In the renewable energy and toll road sectors, regulations exist. Car manufacturing companies also invest due to well thought out policy and predictable incentive packages. These examples create many jobs and stimulate the economy at negligible cost to government. It needs to be rolled out to many more sectors, starting with accelerated toll road building.
The South African government could take a leaf from Trump’s book – he has agreed to a policy that provides tax credits or tolls on new roads. The US plan in its current rough form would seek to incentivise the private sector to increase investment in infrastructure projects on the basis of tax credits and future usage fees, such as road tolls. As a result, US governors have already flagged 300 high-priority projects that are ready to proceed ‘today’.
In the US there is a full consensus that there are infrastructure problems in the US. We could do well to follow policy leads from some of these countries. There is already a full consensus in South Africa. There is also the capital on South Africa Inc’s balance sheet.
To kickstart South Africa’s own infrastructure roll-out would simply require a change of heart by government as to the level of private participation. For instance, Trump’s policy aims to essentially sidestep political squabbles by focusing mostly on private investment. Here is a policy choice that South Africa could immediately follow for quick results.
Trump is not the only leader looking to stimulate infrastructure development through the private sector: Germany, India and Chile are also looking at private sector participation in their road systems. Tolls generate sufficient cash flow to develop the infrastructure more efficiently.
 By Thandokazi on May 09, 2017 09:39 am

Tuesday, May 9, 2017

MAN RAPES PREGNANT DOG!

Dog rape in South Africa, does not end. On Monday May 8, a local South African newspaper Daily Sun published a story about a man raping a pregnant dog.   Here is the story.

NOMHLE Punguzwa’s dog was very popular ekasi, but little did she know that her neighbour had evil thoughts about her pet. 

On Saturday morning, the 37-year-old from Joe Slovo in Port Elizabeth was horrified when her pregnant dog was allegedly raped! 

She told Daily Sun: “At 7am, a neighbour woke me up after seeing my neighbour taking my dog into his house.” 

Nomhle said she rushed to the house fearing the suspect was going to kill her pet.
“We knocked at his door but he didn’t open. We waited for over 30 minutes before I went to fetch my uncle. Soon other neighbours were also on the scene,” she said. 

“We entered his house and I saw my dog escaping through the fence. Her privates were bleeding and she was crying in pain. We decided to call the cops.” 

When police arrived with the SPCA, they found blood stains on the floor and arrested the neighbour. “The SPCA took my dog for treatment and confiscated his own dog.” 

Nomhle said the man destroyed the love she had for her dog. 

“She was like my baby. People adored her. She was pregnant when this evil man raped her,” she said.
“I hope the SPCA keeps my dog because I’m traumatised. I can’t live with her anymore because I constantly will be reminded of what happened to her.”

The suspect was taken to Kwadwesi Police Station. At the time of going to print, the officers’ phones were switched off.    Here is the link to the source again.

In the post we have posted several articles about animal abuse including dog rape.   Here is one of the old ones. 

Dog rape in South Africa - the endless horror of abuse

Dog Rape and Animal Abuse in South Africa