News in South Africa 21st January:
1. Economy needs restrictions reduced:
Western Cape premier Alan Winde is offering suggestions how to allow a controlled reopening of the economy under Covid-19 regulations, including a limited resumption of the sale of alcohol.
He told the provincial legislature about his concerns for businesses and that he had held discussions with health minister Zweli Mkhize specifically about the impact on wine farms in his province.
“Every single other town has -25, -30 [% growth]. The real indicators are hospitals, oxygen use, the test positivity rate. Our test positivity rate for the last two weeks has continued coming down,” said Winde.
The indicators of a slowdown in the rates of new infections were there despite the reopening of businesses after the festive season, he said.
2. Consumer inflation at 16 year low:
Statistics South Africa has published its Consumer Price Index (CPI) for December 2020, capping off a year which saw an average annual inflation rate of just 3.3%.
This is the lowest annual average rate since 2004 (1.4%) and the second-lowest since 1969 (3%).
Annual inflation ended 2020 at 3.1% in December, slightly lower than November’s reading of 3.2%. The monthly increase in the CPI was 0.2%, up from 0% in November.
The food and non-alcoholic beverages category was the main driver of inflation in December, with a monthly increase of 0.5% and an annual rise of 6%. This was up from November’s annual reading of 5.8%.
Luigi Marinus, portfolio manager at PPS Investments, said that the impact of the Covid-19 pandemic and the most recent lockdown due to a second wave of infections remains the most important consideration in policy decision making.
“Even though there has been much spoken and written about the efficacy and rolling out of vaccines, it is still uncertain when a large enough proportion of the South African population will receive this vaccine.”
3. SARS caught out by Flash problems:
The South African Revenue Service (SARS) has apologised “unreservedly” as some taxpayers are struggling to submit its eFiling forms that are still using the now-defunct Adobe Flash software.
Once wildly popular, the technology has become less relevant as newer internet standards like HTML5 took over.
Back in 2017, Adobe announced that it was planning to end Flash by stopping to support and update it at the end of 2020.
SARS says it was aware of Adobe’s decision, and had already migrated its most-used forms to HTML5 and other platforms. This includes income tax returns, as well as PAYE and VAT forms.
But more than half of its online forms still use the Adobe Flash technology – including for dividends tax, excise duties and transfer duty declarations.
SARS now admits that its “erred” by assuming that Adobe Flash Player would continue to function after Adobe ended its support at the end of 2020.
In an interview with 702’s The Money Show, Intikhab Shaik, head of technology and solutions delivery at SARS, told presenter Bruce Whitfield that SARS did not expect Adobe would “actually block” Flash Player from working. This happened on 12 January 2021.
“This error has created frustration to many taxpayers to whom we owe an apology,” SARS said in a separate statement.
4. Matric paper marking almost done:
Six provinces have concluded the marking of matric scripts; the rest are expected to finish by Friday.
At a media briefing this morning, basic education director general Mathanzima Mweli and director of national examinations Priscilla Ogunbanjo outlined the process to be followed when marking is concluded.
Ordinarily, by early January the matric class would receive their results, and the department would have been occupied with the new academic year.
However, because schooling was suspended for months last year, with grade 12 learners missing three months of schooling after a level-five lockdown was instituted, the matric examination started later.
The last paper of the matric exam was written on 15 December. This has meant that all processes concerning the exam have been pushed back.
Speaking at the media briefing, Ogunbanjo said that Gauteng, KwaZulu-Natal, Limpopo, the Eastern Cape, Mpumalanga and the Northern Cape had finished their marking well ahead of schedule. The last day of marking is on Friday. She said those provinces yet to finish marking were left with one or two subjects to complete.
Ogunbanjo also said that the capturing of marks had already started at 34 capturing centres across the country, and that this process will be concluded on 25 January.
5. Two forex trading companies liquidated:
Praesidium and Imagina FX were placed in liquidation last year after clients’ demands for refunds went unanswered.
As the bells were ringing in the 2019 New Year, Praesidium Global fired off a self-congratulatory newsletter to investors announcing that its Managed FX Fund had clocked up an astonishing return of 43.5% for the previous year.
However, in June 2020, Praesidium Wealth investors received a newsletter with some alarming news. Covid was a “black swan” event that had created unprecedented volatility in world markets, resulting in a 40% drawdown in funds under investment. Praesidium, like many other investment companies, was not immune to this volatility.
Not long after this, Praesidium and its sister company Imagina FX were placed in liquidation in October 2020 after investors approached the court saying they were unable to make withdrawals.
The question the liquidators are now trying to answer is whether there is anything left for investors.
There were three companies bearing the name Imagina: Imagina FX, Imagina Asset Management, and Imagina International Trading, based in Mauritius.
The Financial Sector Conduct Authority (FSCA) has opened a forensic investigation to find out what happened to the money under Praesidium control, which Van den Heever estimates at north of R1 billion. Others put it closer to R2 billion.
All information sourced from articles posted by: BusinessTech, Business Insider, TimesLive, M&G, and Moneyweb.
