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Cape Town – This week saw two prominent economic leaders warn South Africans against calls to seize land, saying it would not lead to economic transformation and that land redistribution requires more nuanced planning.
These are Fin24’s five hot topics on Thursday:
1. Land seizures
Calls to seize land is not necessarily the path to economic liberation, and South Africa might follow the same path as Zimbabwe if it does not take heed to its neighbour's lessons, said political economist Moeletsi Mbeki.
Zimbabwe’s problem was not land redistribution, but rather access to capital. “There was no capital to drive modern agriculture in Zimbabwe,” he said at the inaugural Courageous Conversations dialogue hosted by the Nelson Mandela Foundation on Wednesday night.
Outgoing National Treasury director general Lungisa Fuzile added to this message on Tuesday night, when he said that “some of the land that has been redistributed already may not be used as effectively and productively as it should”.
He told a UCT Graduate School of Business event that South Africa needs “programmes to skill the people who have the land to assist them in whatever way necessary and possible to put that land to productive use”.
2. The risky rand
As South African political risks mount and commodity prices retreat, banks from JPMorgan Chase to Morgan Stanley and Bank of America are telling clients to short the rand against other major emerging-market currencies, including Turkey’s lira and Mexico’s peso, Bloomberg reported.
“It’ll be difficult for the rand to regain the bullish momentum that dominated throughout the second half of 2016 and earlier this year,” said Piotr Matys, a currency strategist at Rabobank in London who sees the currency weakening beyond R14 per dollar in the next few months. “The rally is more than likely over.”
Meanwhile, some of the banks accused of manipulating trades in the rand are objecting to the complaint by Competition Commission, calling it vague and embarrassing, and demanding it be amended or dropped.
“The commission has failed to plead the material facts necessary to sustain the allegation that there was an agreement, or agreements,” between the lenders of colluding to fix the value of the currency, lawyers for Bank of America Merrill Lynch said in a documents published on the Pretoria-based Competition Tribunal’s website on Wednesday.
3. Life insurance complaints
The long-term insurance company which received the most complaints during 2016 is Old Mutual, according to the long-term insurance ombudsman’s annual report for 2016.
Old Mutual topped the list of complaints, with 723 or 13.77% of total complaints. Of these, 454 cases were considered. Liberty Group ranked second with 587 cases or 11.18% of total complaints. Hollard Life Assurance Company followed, with 492 or 9.37% complaints.
Other players like Sanlam Life Insurance saw 273 complaints submitted to the ombudsman. Metropolitan Life clients submitted 376 complaints, MMI Group 316, Assupol Life 300, Clientele Life Assurance Company 226, Discovery Life 184 and Outsurance Life Insurance reported 30 complaints.
4. FICA implementation
The regulations that will flow from the signing of the Financial Intelligence Centre Act (FICA) into law will be finalised soon so that the amended piece of legislation can take effect, said Communications Minister Ayanda Dlodlo on Thursday (pictured below on Thursday).
During a media briefing following the fortnightly Cabinet meeting, Dlodlo said Finance Minister Malusi Gigaba is currently consulting all the relevant stakeholders that will be part of overseeing FICA. This includes banks, the Financial Intelligence Centre and the prosecuting authorities.
5. Dark side of online games
Spend enough time hunting terrorists or wandering dystopian wastelands in online games and you’re bound to come across players hurling xenophobic and racist taunts at each other - from the openly Islamophobic in Europe to Korean and Japanese gamers bickering over disputed islands, Bloomberg reports.
Their antics, along with those of peers from a panoply of countries and ethnicities, are gaining notoriety through countless online videos as the embodiment of a global online gaming phenomenon that’s gathered momentum: the spread of xenophobia and racism.
Once limited to consoles in the living room, advances in internet speeds and multiplayer technology now let thousands from around the world join the fray, employing microphone headsets to scream everything from encouragement to abuse at each other.
