Friday, 8 June 2018


There were scenes of shock and horror on Tuesday when Stats SA revealed that GDP in the first quarter had slumped 2.2% (annualised) from the previous 3 months. The wonks were soon out there waving their hands trying to explain such a dreadful number. The idea that Q1 figures are always down from Q4 (Christmas season) doesn’t really fly because, in recognition of just this phenomenon, Stats SA makes seasonal adjustments to the data. Whether or not this adjustment and equally the companion correction for inflation are doing their jobs properly is the subject for a far more boring publication than Tidemarks. What we can say however is that these large swings of a parameter measured in several trillions of Rands and the general “look and feel” of all the numbers makes seasoned data diggers uneasy as to the quality and accuracy of much which is so diligently published.  It should be noted, however, that the highest growth was recorded in the Government sector, while Manufacturing, surely the cradle for job creation, showed the largest contraction. And there is the nub of the nation’s real problem.
Unsurprisingly the two most sensitive indicators of what the big money is thinking, the currency and the bond market, have weakened quite badly; for the most part setting new lows for the year.
It’s nearly impossible to get someone to change their mind about matters of political philosophy despite truck loads of evidence that suggest they are plain wrong. The third iteration of a so-called Mining Charter is on the table and reportedly government is very excited about identifying people who without any investment or contributions, but because of who they are and even where they live, should benefit from any upside created by a mining operation. Barring a very few spectacular examples (including perhaps our current president) socialist legislation and regulation has been disastrous for the nation’s mining industry and the ordinary people who have tried to make a living from it. Mining’s share in the economy and the number of people it employs have shrunk enormously since these interventions started taking place. The nation has a long list of other fading and failing areas where central planners have destroyed value and hope. Frustratingly, nothing has yet managed to elicit an “Ah-ha” moment that perhaps something is not working. Well, it is working for the select few who have been able to get the keys to the national treasury safe and clean it out.
Minister Pravin Gordhan is down as the keynote speaker at tonight’s Gala Dinner being hosted by the Black Management Foundation. His speech is entitled “Ethical Leadership as a Catalyst for Transformation and Inclusive Economic Growth” And right on cue, after a period where the country has definitely not been enjoying “ethical leadership”, the dreadful growth results are published. The speech will write itself! However, it is doubtful whether the racism inherent in the membership criterion of the host organisation and also implicit in the current meaning of the terms transformation and inclusive are legal, let alone ethical. But it’s worth trying anything to try and fix this mess we are in. Charts showing how much of the fuel price is being siphoned off by government to cover the shortfalls caused by their negligence, incompetence and corruption have raised the general levels of awareness and dissatisfaction by several notches.
It’s that time of year when in a spirit of comradeship, thousands of people run between Durban and Pietermaritzburg. This time it’s the “down” run and for the first time will finish at the now iconic beach-front soccer stadium named after a long-forgotten worthy. [Politicians spending money the nation doesn’t have to find a recent rogue to name the Cape Town airport after, should take note.] In the meantime, the junior ‘bokke are taking the long way around to get to the knock-out rounds at the U20 Rugby World Cup in France. Watching this tournament does raise the question of just how familiar many of the participating players are with their date of birth. It also makes genuine South African sports fans wonder if this country will ever be able to select national teams based solely on merit. Also diverting in slow moments at the Canadian GP is watching the St Lawrence flowing strongly past the track and wondering how long a river like that would take to solve Cape Town’s water shortage.
James Greener
Friday 8th June 2018