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Cape Town - A roundup of Friday's top economic and finance reads on Fin24.
Ramaphosa refers allegations of corruption at Eskom and Transnet to the SIU
President Cyril Ramaphosa referred allegations of mismanagement and graft at state power utility Eskom and rail and ports group Transnet to the Special Investigating Unit.
The SIU, which probes corruption and maladministration in the government, must include “any alleged serious maladministration in connection with the affairs of the institutions”, in its investigations, Ramaphosa said in an order published in the Government Gazette.
Other terms include probing unlawful appropriation or expenditure of public money or property and improper conduct by employees of the companies.
Eskom and Transnet have both been caught up in allegations of corruption linked to the politically connected Gupta family, who are friends with former president Jacob Zuma and have done business with his son. Everyone involved has denied wrongdoing.
New financial regulator working with international bodies to track Viceroy
The Financial Sector Conduct Authority (FSCA) has been in contact with its counterparts in the US and the UK in a bid to contact short seller Viceroy, who published their report "A Wolf in Sheep's Clothing" about Capitec Bank in January.
The report, which saw Capitec’s share price dive by up to 25%, claimed the bank was using predatory lending practices and illegal fees to inflate profits. Several market analysts have since criticised Viceroy’s report and the South African authorities are investigating whether there was any market manipulation or insider trading involved.
“We cover all bases, without going into detail…we have contacted our counterparts in the US and the UK to try help us find out who Viceroy is and if they can help us contact them,” FSCA’s head of market abuse Solly Keetse told a media roundtable in Pretoria on Thursday.
The FSCA replaced the Financial Services Board this week as the Twin Peaks model for financial regulation came to force on April 1. The Prudential Authority was also established to ensure the soundness of financial institutions.
The authorities will create a safer financial market for consumers to ensure they are treated fairly and will ensure stability of the financial system. Their establishment is in line with the Financial Sector Regulation Act for 2017.
Eskom warns of fake jobs scam
Eskom has warned the public about a potential recruitment scam that has been doing the rounds on different social media platforms.
On Friday the power utility assured job seekers that Eskom’s website is the only platform where they would be told about employment opportunities at the company.
"This is currently the only authentic job search site for Eskom vacancies.
"The public is advised to only use this site to search and apply for jobs advertised at Eskom," the company said in a statement issued on Friday.
US unemployment rate remains at its lowest since 2000
US hiring cooled by more than forecast in March following a strong February while wages picked up and the unemployment rate remained the lowest since 2000, returning labour-market progress to a more sustainable pace that may keep Federal Reserve policy makers on track for further interest-rate increases.
Payrolls rose 103 000, compared with the median estimate of economists for 185 000, after an upwardly revised 326 000 advance, Labour Department figures showed Friday. The jobless rate was 4.1% for a sixth month, bucking forecasts for a decline, while average hourly earnings increased 2.7% from a year earlier, matching projections.
The results follow strong hiring in 2017 and show an average pace of payrolls growth this year that’s still sufficient to push down the unemployment rate, which already is below Fed estimates of levels sustainable in the long run. A pickup in wages - which has remained elusive in this expansion - would support consumer spending, though some economists worry it may also spark inflation.
Revealed: How SA’s super-rich are living it up
The luxury sector in South Africa generated revenue of about $2.2bn (about R27.28bn) in 2017, slightly less than the $2.3bn in 2016, according to the South Africa 2018 Wealth Report released by AfrAsia Bank and New World Wealth this week.
These figures include luxury cars, luxury clothing and accessories, luxury watches, private jets, yachts and luxury hotels and lodges. Luxury hotels are the largest component.
The report defines the super-rich (high net worth individuals) as those with wealth of $1m (R12m) or more. "Wealth" is defined as the net assets of a person. It includes all their assets (property, cash, equities, business interests) less any liabilities.
According to the report, the South African luxury goods market is dominated by foreign brands. However, there are a few local SA brands that make luxury and semi-luxury goods like Ardmore Ceramics, Avoova and Carrol Boyes. The report predicts that this sector will grow strongly over the next 10 years.
The report also reveals the suburbs in Cape Town and Johannesburg where the super-rich are living.
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