A fascinating spat has broken out between the Reserve Bank and National Treasury over the need to retain exchange controls. The former have their doubts that the controls are relevant, while the latter – whose job it is to decide upon the matter – splutter that they are perfectly happy and we shall just have to wait for the budget speech to see if they will change their mind. I think that the sole sufferers of these controls are now just emigrants and their so-called blocked rands. Everyone else seems to be able to “make a plan”.
And making a plan is what all these BEE deals are about. Another swarm of them left the hive this week moving so fast that it was hard to see where the money came from although we can guess where it’s going to. One day all this undoubted misallocation of capital will haunt us – and provide plenty of material for several academic theses.
The currency spiked a tad weaker in the fuss that followed and that, plus an all-time high for the price of platinum, gave the mining shares a solid boost. Elsewhere the buyers were not as excited and the All Share index moved only a short distance north of the 17 000 level it breached last week. It is, however, without a doubt, a bellowing bull market. Now that unambiguous statement should see prices plummet presently.
Once upon a time I earned petrol and beer money by working through the night monitoring the antennae, receivers and recorders of a small radio telescope observatory. The heavenly bodies of interest were the planet Jupiter and its satellite Io. The data was captured as inky traces on long rolls of chart paper which we took back to the lab and tried to make sense of. It was pretty crude but not that different from the data capture system now in use at SALT, the hemisphere’s largest optical telescope now operational at Sutherland in the Karoo. Because of insufficient local telecommunications bandwidth, the data can not be squirted out through the internet but instead is captured on little Compact Discs and then carried by hand to observers around the globe. Isn’t that really embarrassing for the country in general and Telkom in particular? This is another example of how urgently we need to lift the dead hand of bureaucracy off the important levers in the economy.
Today, I believe that there was a ceremony in Pretoria where the Postal Regulator issued the first batch of licences to courier companies wishing to transport items weighing less than 30kg. I suppose that includes the CDs from SALT. The licensing regulations are being “introduced mainly to protect the Post Office from unfair competition”. Our business, like many others, has no choice but to use the postal service for client communication every month, We would all agree that the service seriously needs loads of competition, whether fair or not. My invitation to that ceremony must have got lost in the post. A pity, I’ll bet the catering was lavish.
Opulent, however, is probably the word needed to describe the government offices in Pretoria on which R10bn (yes – billion!) will be spent in the next 25years (compare the R36m bill for the telescope). Also consider that an audit has revealed that the Mpumalanga education department was defrauded of a mere R26m through non-delivery of toilets and water tanks. These guys are getting out of control.
James Greener
11th November 2005
