News in South Africa 8th March:

1. ETC corruption allegations:

Police reports and documents provided to the National Prosecution Authority (NPA) have brought grave allegations against Electronic Toll Collection (ETC) and its parent company, Kapsch TrafficCom.

ETC corruption allegations
Image taken by: Life Of Pix

Among the allegations are that ETC, with full knowledge of Kapsch, made payments totalling R10 million over three years to a company called ProAsh Business Services without receiving any services or deliverables from the company.

According to the allegations in the police report, ETC defrauded the South African National Roads Agency Limited (SANRAL) by misrepresenting these payments.

The police reports also contain allegations that ETC and Kapsch may have bribed Zambian government officials via a local subsidiary called Intelligent Mobility Solutions (IMS).

The head of IMS allegedly claimed that he spent $2.6 million (US dollars) on bribing various Zambian officials.

When Kapsch was informed of the claims being made by the head of its IMS operations in Zambia, the person who reported the issue alleged that he was placed on suspension instead of the matter being investigated.

2. Rand under pressure:

The rand is under pressure at R15.37/$ this morning as markets remained unsettled.

This morning, Brent crude oil was trading above $71 a barrel – the first time in more than a year – after Saudi Arabia, the world’s top oil exporter, said a petroleum storage tank at one of its shipping ports was attacked by drone.

On Friday, Sasol’s share price surged by 14%, as oil prices climbed following an Opec decision not to hike output.

3. GDP data this week:

South Africa’s Q4 GDP data will be published this week, with economists expecting a significant contraction for the year.

Economists generally expect that the economy would have continued its recovery in the last quarter of 2020 – with forecasts mostly around the 5% level – but that the Covid-19 pandemic would see gross domestic product (GDP) shrink by around 7%.

Statistics SA will announce the GDP figures for the final quarter of 2020 and the year as a whole on Tuesday (March 9).

Hugo Pienaar, chief economist at the Bureau for Economic Research, says the team at the University of Stellenbosch expects further economic recovery in the fourth quarter of 2020, but that the figure will not be as strong as the growth in the third quarter compared to the second (when the economy recorded annualised ‘growth’ of more than 66% after the decline of 51% in the second quarter).

The important figure to watch is the annual growth, which Pienaar says will show that the economy shrank by around 7% compared to 2019, under the assumption that the economy expanded by 5% to 5.5% in the last quarter compared to the preceding three months.

“Actually, it doesn’t really matter if growth in the last quarter was 3% or 6%, the figure for the full year will be around minus 7%,” says Pienaar.

“It will take the SA economy several years to recover to the levels of 2019,” he adds, “based on general forecasts of economic growth of 3% this year and 2.5% next year.”

4. Old mutual hikes claim provisions:

After putting aside almost R1.4 billion for expected Covid mortality claims last year, Old Mutual has hiked this provision by R4 billion after higher-than-expected claims.

The company is also concerned about “emerging expectations of a third wave given evidence of virus mutation, the slow pace of the vaccination rollout and upcoming public holidays and the winter season”.

In January and February alone, it recorded some R1.9 billion in Covid-related mortality claims.

In a trading update on Monday, the company warned that its headline profit may decline by between 42% and 62%.

5. CEO of ABSA and SABC passes away:

Peter Matlare, the deputy chief executive officer of Absa, died from Covid-19 complications this weekend.

He was 61. Matlare served as the CEO of the SABC and Tiger Brands, and was an executive at Vodacom.

All information sourced from articles posted by: BusinessTech, Business Insider, MyBroadBand, Moneyweb,

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