Nigeria has displaced South Africa as the continent’s economic powerhouse and in April Muhammadu Buhari was swept into power by an electorate fed up with graft and corruption. Despite its infamous 419 scams and Boko Haram terrorism, scores of South African companies see this as the African growth story of the next decade.
South Africa is known for sunshine, vuvuzelas, safaris and Madiba. A small country, in global terms, at the tip of the vast African continent that lures millions of tourists every year. That is not all that the nation known for the first heart transplant and turning coal into fuel is regarded for. Finweek takes a look at a number of these concepts and products that are standing SA in good stead overseas.
Nobel Prize laureate and one of the world’s top economists, Professor Robert Shiller of Yale University warns that the New York Stock Exchange may be on the brink of a bear market. His past predictions have been accurately fulfilled. His secret weapon, the Cyclically Adjusted Price-Earnings ratio indicates that investors should take caution.
With two new entrants into SA’s small domestic airline market, the company with the biggest bank balance would survive in an environment where large-scale investment is needed to boost airplane efficiencies, Comair CEO Erik Venter told Finweek. Upgrading aircraft to keep them efficient is one aspect of Comair’s cost saving strategy.
South Africa’s major banks have reported record profits, growing 11 times faster than GDP, in the first half of 2015. This performance is driven by the strong growth in the rest of the African continent. Finweek journalist Buhle Ndweni speaks to experts who give insight on the success of these local banks, post- financial crisis.
South Africa’s stock exchange is dominated by large companies such as British American Tobacco, SABMiller and mining giants BHP Billiton and Anglo American. Most funds’ criteria to invest in stocks include a high liquidity, or volume of shares traded, so they can move in and out of a position easily. In the process, a number of smaller companies, called small caps, are forgotten. Finweek spoke to analysts about the outlook of nine such stocks.
Great uncertainty seems to be the driving force behind world markets at the moment. when the sun shines at its brightest on the markets, investors seem blinded by the light and unable to see actual fair value, while these very investors fail to see anything good when the markets are at their darkest, says PSG Wealth portfolio manager Schalk Louw.
With vehicle exports soaring, it appears the effects of government’s Automotive Production and Development Programme seem to be making an impact. And despite local vehicle sales figures remaining depressed, writes Finweek contributor Marcia Klein, manufacturers continue to invest in production capacity at their South African plants.