Tuesday, January 26, 2010
From Creamer Media in Johannesburg, I'm Brad Dubbelman.
Making headlines:
President Jacob Zuma left for Davos, Switzerland yesterday where he will lead a South African delegation to the World Economic Forum (WEF). Under the theme "Improve the State of the World: Rethink, Redesign and Rebuild," this year's annual meeting will promote a global system of governance. The Department of International Relations and Cooperation says that pressure to reassess has increased, along with concern over the current state of the world financial markets. Fiscal and monetary prescriptions to ease the pain of global economic shocks are now fuelling anxieties about the creation of new economic bubbles. Moreover, the demographic, behavioural and technological changes linked to the collapse in global demand are challenging basic assumptions about the nascent economic recovery.

Inflation is a bigger problem than the strong exchange rate for South Africa's competitiveness, and should, therefore, be of more concern, said former Rand Merchant Bank economist Rudolf Gouws yesterday.
Speaking at an economic outlook conference, held at the University of Pretoria's Gordon Institute of Business Science, he said that there is little the South African Reserve Bank (SARB) can do about the exchange rate, as this was mostly influenced by global occurrences. Nevertheless, the strengthening of the rand has impacted on many sectors, leading to debates about whether the Central Bank should intervene, or not.
Late last year, the ruling African National Congress, the Congress of South African Trade Unions and the South African Communist Party agreed to look at broadening the mandate of the SARB. Gouws noted that South African policymakers do not have a fixation with inflation targeting at the expense of economic growth and added that the country's inflation targets, of between 3% and 6% were among the most lenient. Further, he noted that, contrary to popular belief, there is no global move away from inflation targeting.

Business must begin accepting that the milieu in which it operates has changed and that it is facing more than just an economic crisis, King Committee on Corporate Governance chairperson Professor Mervyn King said yesterday. Also speaking at the Gordon Institute for Business Science conference, he said that the world is facing a financial, a climate-change and an ecosystem and biodiversity crisis. While the world would emerge from the global economic crisis in the not too distant future, the climate-change and biodiversity threats would linger, King asserted, adding that while banks could be bailed-out, no such remedy existed for "Mother Earth". Therefore, sustainability is the social and economic imperative of the twenty-first century, with a growing world population having created a planetary crisis.

Also making headlines:
Zimbabwe's High Court rules that confessions by a chief State witness implicating Roy Bennett are inadmissable as they were not made freely.
Liberia's President Ellen Johnson-Sirleaf will seek re-election in 2011.
Congress of South African Trade Unions general secretary Zwelinzima Vavi says that government's job promises are faltering.
And, the European Union is to set up a military mission to train Somali government forces to fight an Islamist insurgency.
That's a roundup of news making headlines today.