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SA’s 10-year growth streak ends

first_imgSouth Africa’s quarterly deterioration was “modest compared with that of other countries,” according to Business Report, which noted that, for the same period, GDP had fallen by 3.8% in the US, 4.3% in Thailand, 8.4% in Taiwan and 12.7% in Japan. It was the first quarterly contraction since the third quarter of 1998, and the biggest contraction since the fourth quarter of 1992, when South Africa’s GDP declined by 3.5%. South Africa’s gross domestic product (GDP) figure at market prices for the fourth quarter of 2008 shrunk by 1.8% quarter-on-quarter, from 0.2% growth in the third quarter, Statistics South Africa (Stats SA) announced on Tuesday. Sectors that contributed to the negative fourth-quarter GDP figure include manufacturing and the electricity, gas and water industry. The wholesale and retail trade and hotels and restaurants sectors did not contribute to growth at all. SAinfo reporter and BuaNews 25 February 2009 Positive contributions to fourth-quarter economic growth came from finance, real estate and business services; agriculture, forestry and fishing; as well as general government services. “So in plain English terms, the economy has receded, but we are not in a recession,” Lamberti said. The wholesale and retail industries, as well as mining, quarrying and manufacturing, experienced either no growth or negative growth in 2008. The global economic crisis has resulted in declining demand for South Africa’s commodity exports, putting the country’s mining and motor manufacturing sectors, in particular, under increasing pressure. The main positive contributors for 2008 as a whole were the finance, real estate and business services industry; agriculture, forestry and fishing; construction; and general government services. South Africa’s economy contracted for the first time in a decade in the fourth quarter of 2008, despite positive growth in agriculture, finance and construction, as the country’s mining and manufacturing sectors came under increasing pressure from the global economic recession. The construction, transport, storage and communication, as well as personal services sectors, also experienced positive growth in the fourth quarter of 2008. Econometrix Treasury Management economist Russell Lamberti told BuaNews that the country was not technically in a recession yet, noting that the textbook definition of “recession” was two consecutive quarters of negative growth. South Africa’s growth figures for the first three quarters of 2008 were 1.7%, 5% and 0.2% respectively, Stats SA reported, with annual GDP growth coming in at 3.1% compared to 5.1% in 2007. Global crisis hits commodity exports Would you like to use this article in your publication or on your website? See: Using SAinfo materiallast_img read more

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Etihad Airways to support Virgin Australia capital raising

first_imgGulf airline Etihad Airways has confirmed its continued support for Virgin Australia and will maintain its 21.8 per cent stake in the Australian carrier and a seat on its board.Etihad confirmed on Wednesday that its board had endorsed a proposal to take up its pro-rata entitlement in Virgin’s $852 million capital raising due to close at 5pm the same night.Estimates are that this will see it stump up as much as A$186m in cash.“Etihad Airways is a long-term strategic investor and commercial partner to Virgin Australia, and remains fully committed to the partnership as a shareholder.’’ the airline said in a statement announcing it was taking up its pro-rata entitlement in the non-renounceable offer at 21c per share.“As a result, the airline will retain its 21.8 per cent shareholding in Virgin Australia and its seat on the board of directors.“Our comprehensive 10-year commercial agreement, which runs until 2020, is further evidence of our confidence in and support for Virgin Australia, and our commitment to the airline and Australia.’’The capital raising, cost-cutting and fleet rationalisation at Virgin are part of a move to repair the airline’s balance sheet after an expensive restructure aimed at making it a serious competitor to Qantas.Shareholders Singapore Airlines, Virgin Group, HNA and Nanshan Group have committed to the raising.last_img read more

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SA-DRC pact paves way for Grand Inga

first_img20 May 2013 With South Africa confirmed as a key partner, the Democratic Republic of Congo (DRC) has announced October 2015 as the launch date for construction of the first phase of what could eventually be the largest hydroelectric plant in the world. The Grand Inga project on the Congo River is expected, once all the phases are complete, to generate a massive 40 000 MW of electricity, bringing renewable power to half of the African continent. The initialling of a historic energy cooperation treaty between the DRC and South Africa in Lubumbashi in March was a key milestone in the process of bringing the project, first conceived in the early 1970s, closer to fruition. At a meeting in Paris on the weekend, organised by the DRC government and with a high-level South African delegation in attendance, a range of stakeholders consulted on the implementation of the first phase of the project, Inga 3, which is expected to cost in the region of US$12-billion and produce almost 4 800 MW of electricity. Two existing dams, Inga 1 and 2, have been in operation since 1972 and 1982 respectively, together generating nearly 1 800 MW. In terms of the March treaty, South Africa “expects to purchase a significant share of the electricity production of the new dam, thus confirming itself as a key partner,” the DRC government said in a statement on Saturday. “As such, the Republic of South Africa will take 2 500 MW of the 4 800 MW of future power production of Inga 3, thereby becoming the principal purchaser.” Garrith Bezuidenhoudt, chief of staff in South Africa’s Department of Energy, said in the statement that the South African government had “affirmed our commitment to the project by already provisioning for this purchase in our budgetary plan”. Inga 3 is expected to fill the power gap in the DRC, with its fast-growing population and expanding industries, and to help meet burgeoning demand in South Africa. Subsequent phases, adding up to an eventual total capacity of 40 000 MW, will allow countries in southern Africa, north-east Africa and parts of west Africa to benefit from production at the site. “Grand Inga will thus provide more than half of the continent with renewable energy at a low price,” Bruno Kalala, the DRC’s minister of water resources and electricity, told Saturday’s meeting. However, Kalala said, issues around transport and connectivity had yet to be addressed. “Inga is a factor for integration, at both a regional and international level.” According to the DRC government, three consortia are competing to develop the project: Sinohydro and Three Gorges Corporation from China, the operator of China’s Three Gorges dam, currently the world’s largest; Actividades de Construccion y Servicios, Eurofinsa and AEE from Spain; and the Daewoo-Posco-SNC Lavalin consortium from Korea and Canada. The Africa Development Bank, which has been involved in the project since 2009, is financing the base studies and consultants, and has been joined by the World Bank, the French Development Agency, the European Investment Bank and the Development Bank of Southern Africa. “The question of financing is a major issue in the selection process,” said Hela Cheikhrouhou, director for energy environment and climate change at the African Development Bank. “It is the public-private partnership financing solutions which will be vital for the success of the project.” SAinfo reporterlast_img read more