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Top 5 on Fin24: Zuma curse, bloated Eskom and who's dealing with Moyane's suspension

Cape Town - A roundup of Tuesday's top economic and finance reads on Fin24.

Curse of Zuma lingers even as SA savours junk reprieve

South Africa might take a while to shake off the curse of Jacob Zuma on its credit ratings.

One year since the country lost its investment-grade rating as the former president fired his finance minister, SA is basking in new-found confidence with Cyril Ramaphosa in charge.

Still, it’s too early to talk about upgrades, analysts - including Isaah Mhlanga from FirstRand's Rand Merchant Bank unit - said. Economic growth will only reach 2% by 2020, according to the central bank, and government debt is more than 50% of gross domestic product.

Rand to remain vulnerable to global economic events this week

The rand opened at R11.85 to the dollar on Tuesday following the Easter break, with analysts saying it remains vulnerable to global events, including the trade war between the US and China and the release of US economic data on Friday.  

The currency was trading at R11.82 to the greenback by 16:47, after reaching an intra-day low of R11.87/$ earlier in the session.

"The trade wars theme does not seem to want to budge at all. This time around it was China that fired the shots with them imposing counter tariffs against the USA," TreasuryONE dealer Andre Botha said in a statement.

Eskom rolls out plan to tackle bloated workforce

After a decade of unprecedented growth in staff numbers, cash-strapped Eskom is finally tackling the controversial issue of its headcount.

The power utility, seen by Goldman Sachs as the biggest single risk to the South African economy, employed about 47 600 people as of March last year, compared with 32 600 a decade ago.

A bloated workforce means high costs for a company struggling with cash flow. But it’s stuck in a three-way tug of war between labour, which rejects job cuts, the African National Congress, which wants to boost the economy, and funders, who are leery of financing Eskom because of the way it’s been managed.

Ramaphosa dealing with Moyane suspension - Nene

Finance Minister Nhlanhla Nene said on Tuesday President Cyril Ramaphosa is dealing with the suspension of former SARS commissioner Tom Moyane, who left the service last month under a cloud.

“The issue of Moyane is being dealt with by the President... I hope it would be finalised expeditiously,” said Nene during the announcement of tax agency's preliminary revenue collection results.

SARS undershoots revenue target by R0.7bn

The taxman collected R1.216trn in revenue for the 2017/18 financial year - R0.7bn or 0.06% lower than the R1.217trn target set by National Treasury.

Finance Minister Nhlanhla Nene made the announcement at a briefing on the preliminary results at South African Revenue Service (SARS) headquarters in Pretoria on Tuesday morning. Acting commissioner Mark Kingon also delivered an address.

According to SARS, R1.451trn was collected and refunds amounted to R234.3bn, bringing the net figure to R1.216trn. Revenue represents growth of 6.3% or R72.4bn.

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