http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.29Change: -0.09
R/$ = 11.70Change: -0.05
Au 1207.85 $/ozChange: 1.57
Pt 1174.50 $/ozChange: -1.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Letters Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Nov 02, 2007

SA will hit 'magical' 6% growth by 2010 – analyst

Back
FNB property analyst John Loos on the likelihood of more interest rate hikes (02/11/2007)
 
 
 
Africa|Sustainable|Africa
Africa|Sustainable|Africa
africa-company|sustainable|africa
© Reuse this The spate of interest rate hikes over the past several months could have peaked, offering South African consumers something of a breather, while the country is on its way to reaching "that magical mark" of 6% economic growth in 2010, an economist said on Friday.

Further good news was that inflation could begin to slow, as current levels were not sustainable, FNB property economist John Loos said.

"There are signs that the global food price inflation will drop," he told a Johannesburg conference. "We have seen a decline in the past couple of months."

"That's big, because about 26% of our consumer price inflation index (CPIX) basket is food," Loos highlighted.

He said that there could still be some more upward movement in the CPIX, but that its peak was not far off.

"The Reserve Bank have finished with their interest rate hiking," Loos put forward. "By December's meeting, they will probably have decided that they have done enough, and will hold interest rates where they are for a while."

This would be comforting news to the big-spending South Africans who had been slapped with three successive rate hikes this year, in Reserve Bank governor Tito Mboweni's determined efforts to curb inflation, and encourage saving.

However, the Reserve Bank had sprung surprises on the public before, and could do so again.

Dollar due to head further down

The dollar, which has taken a big knock since the subprime mortgage crisis swept the US, has still got its eyes to the ground, which bodes well for a stronger rand, Loos stated.

"The dollar had a few years of weakness ahead," he said. Traditionally, there was an inverse correlation between the strength of the US dollar and the rand.

The US had a current account deficit of some 6% of its growth domestic product, which had far deeper implications than South Africa's current account deficit, owing to the sheer size of the US economy, said Loos.

"The dollar's weakening cycle is far from complete, it has got some way to go."

"We've got some good times ahead for the rand's strength," he commented.

Current account deficit no danger yet

South Africa's current account deficit is not a big danger yet, but it will become a problem in a couple of years time if it continues, Loos went on to say.

Finance Minister Trevor Manuel did not express much concern about the country's yawning trade gap when he presented his medium-term budget speech to Parliament on Tuesday.

Economic growth

Loos was sanguine on South Africa's growth prospects, predicting that economic expansion could reach 6,1% in 2010, which was in line with government targets.

"I believe we are going to head for 6% economic growth," he said, adding that growth would average at 4,6% this year.

He pegged growth at 4,9% in 2008, and climbing to 5,5% in the following year.

It would be in 2010 that he believed South Africa would reach "that magical" mark of 6,1% economic growth, added Loos.

"Sustaining that for 10 or 20 years is another thing, though," he said.

Loos said that one shouldn't overemphasise the influence of politics on economic performance. The ruling African National Congress was gearing up for the election of its new leader at the end of the year, which had caused uncertainty over the effect that a change of leadership could have on economic policies.

Potential candidates for the position included incumbent Thabo Mbeki, Jacob Zuma, Tokyo Sexwale and Cyril Ramaphosa.


Edited by: Mariaan Webb
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
 
Latest News
The Sustainable Energy Society of Southern Africa (Sessa) on Friday called on the Department of Energy (DoE) to follow its three-step “rescue plan” aimed at resolving the uncertainty surrounding the administration of the solar rebate programme. Sessa said its...
South Africa's National Union of Mineworkers (NUM) said on Friday it would oppose any attempt by cash-strapped power utility Eskom to sell assets, especially its finance company which helps provide home loans to employees. Eskom CE Tshediso Matona told the Reuters...
More
 
 
Recent Research Reports
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
 
 
 
 
 
This Week's Magazine
The World Bank, the European Union, the African Development Bank (AfDB) and the government of Sweden have agreed to provide Zimbabwe and Zambia with $294-million for the repair of structural deformations on the Kariba dam wall and avert the possible collapse of the...
Global Electricity Initiative executive chairperson Philippe Joubert
Executive chairperson of the Global Electricity Initiative (GEI) Philippe Joubert says energy utilities globally, together with the business community more generally, have come to terms with the science of climate change, particularly as extreme weather events begin...
JAMES TEMPLETON Emira’s operational performance is the best it has been in a long time
JSE-listed Emira Property Fund reported distribution growth per participatory interest (PI) of 9% for the six months ended December 31, 2014.
JOAN MACNAUGHTON Many countries were also struggling to balance the energy trilemma of energy security, energy equity and environmental sustainability
Sub-Saharan Africa is still faced with the challenge of providing citizens access to electricity and an additional $450-billion will need to be invested to ensure that people in urban areas have access to electricity by 2040.
ABE THELA Cuban engineering skills are not recognised by the Engineering Council of South Africa
Consulting Engineers South Africa (Cesa) last month said it was dismayed that the Department of Water and Sanitation (DWS) was seconding 35 Cuban engineers on a two-year contract to share their expertise with South African engineers in the water sector.
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks
Subscribe Now for $96 Close
Subscribe Now for $96