WEEKLY ROUND-UP: Kganyago pauses, Mboweni and Manuel join new boards

File: Former Reserve Bank governor Tito Mboweni made it onto the PPC board with 84 percent of the vote. Photo: Sapa / Werner Beukes
JOHANNESBURG - Lesetja Kganyago, the Reserve Bank governor, noted the positive impact of lower oil prices on the economy. Yet there is still a lot of uncertainty about the long-term dynamics of the oil price. 
The lower oil price could have stimulated economic growth but this is limited by the impact of load-shedding. Once again, the governor also pointed to the fact that lower interest rates would not do much for an economy battling with structural constraints in infrastructure and productivity.
The repo rate is on hold for now at 5.75 percent. The next MPC meeting will be held from 24 to 26 March. Consumers will also be pleased by next week's reduction in fuel prices. The petrol price is going down by 93 cents per litre.
The US Federal Reserve also held its horses. In its statement after the Federal Open Market Committee, the central bank said it will be patient when it comes to normalising interest rates. 
Trade surplus in December
In December the country trade balance came in at a R6.84-billion surplus. This was expected, as December is a slow month, with imports falling by 10 percent. The steepest fall was in equipment components, which fell by 21 percent.
Exports rose by 4 percent, led by vegetable products which rose by 47 percent. For the year as a whole, exports grew by 6.6 percent whereas imports rose by 8.6 percent. The overall trade balance for the year was a deficit of R95-billion, up from R71-billion in 2013. 
These figures include figures for customs union countries Botswana, Lesotho and Namibia. When these are stripped out, December scores a R683-million deficit and 2014 a deficit of R198 billion. The current account stood at 6 percent of GDP in the third quarter of 2014.
Manuel and Mboweni join new boards
A new board for PPC was elected this week. Breaking with staid conventions, the six new board members were selected from a list of 10 and subjected to a vote. Former Reserve Bank governor Tito Mboweni made it on to the board with 84 percent of the vote. He will form part of the social and ethics and nominations sub-committees.
Tryphosa Ramano has been confirmed as a board member and the company’s chief financial officer.
Former Trade and Industry, Finance and Planning Minister Trevor Manuel joined the board of brewing company SABMiller as a non-executive director. This will be effective from March. Manuel is also the senior advisor and deputy chairman of Rothschild South Africa. He has also been proposed as a board member for Swiss Re, a reinsurance company with headquarters in Switzerland. 
Steinhoff megadeal gains shareholder approval
Steinhoff’s bid to acquire 92.34 percent of low cost retailer Pepkor for R63-billion met with approval by shareholders. Steinhoff will achieve this by buying a 52.47 percent stake from Titan (controlled by Pep Stores founder Dr Christo Wiese), a 37 percent stake from Brait and 2.81 percent from Pepkor Management. 
The furniture retailer, which owns companies such as JD Group will now gain a clothing retail footprint in Africa and Europe. Chief executive Markus Jooste expects the transaction to be concluded by the end of the first quarter, Reuters reports.
This transaction also leaves Brait with a R14.5-billion war chest on its balance sheet. Bloomberg reports that Brait CEO John Gnodde is looking for investments in food and consumer goods markets.
Beleaguered pensioners
The first issue of the Bankserv Africa Private Pension Index, released on Wednesday, confirmed the grim outlook for senior citizens.
At retirement, the average formally employed South African will see their income slashed by more than half. In December 2014 the average pensioner received a take-home pension of about R5,722. The median pension came in at R3,559 per month. The median is the middle number, with half the sample earning above it and the other half earning below it. The median pension increased by 2 percent from 2013 to 2014, far below inflation.
The government grant supports 69 percent of senior citizens. It pays R1,155 per month. 


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