February 27, 2014
From Creamer Media in Johannesburg, I’m Motshabi Hoaeane.
Making headlines:

South African political parties applaud the 'conservative budget'.

Western anger at anti-gay law hits Uganda's currency.

And, Finance Minister Pravin Gordhan’s prioritisation of education is welcomed.

 

Finance Minister Pravin Gordhan's budget contained few surprises, political parties said on Wednesday.

The ruling African National Congress said it understood the tight fiscal constraints under which Gordhan was forced to operate.

ANC secretary general Gwede Mantashe said the fact that Minister Gordhan hadn’t increased taxes reflected the gut feel that South Africans don’t have to be penalised because of difficult times.

However, Democratic Alliance MP Tim Harris described Gordhan's budget as very conservative. Harris said Gordhan was not clear on what would happen if ministers didn’t manage to cut costs in their relevant departments.

Meanwhile, Gordhan's prediction that the current account deficit and budget deficit would go down was good news for the banking sector. The tax incentives attached to the development and promotion of small and medium businesses were also welcomed.
 

Uganda's currency tumbled on Wednesday on concerns that a new anti-gay law would damage relations with Western countries alarmed at what they see as a government-backed violation of human rights.

President Yoweri Museveni's approval of the law on Monday, imposing jail sentences of up to life for gay sex, reflects a gulf in social attitudes between conservative Africa and the West, with Washington saying the law complicated its "valued relationship" with Uganda and several European countries withholding aid.

Uganda’s shilling fell 2% on Wednesday before the central bank intervened to stop the slide, after Denmark and Norway said they would hold back on aid and others threatened to follow.

The currency movement appeared to confirm the prediction by Swedish Finance Minister Anders Borg who said on Tuesday the law was a "financial risk" for Uganda. US Secretary of State John Kerry said Washington would review its relations with Uganda.

University of Witwatersrand economist Kenneth Creamer said Finance Minister Pravin Gordhan's prioritisation of education in his budget on Wednesday deserves praise. He said the R253.8-billion to be spent on education would help bridge South Africa's wage gap.

Creamer said the budget's focus on education was correct, as it was only through widening the pool of skilled and highly-skilled job-seekers and entrepreneurs that South Africa would be able to begin reducing the massive wage gap between the highest earners and low earners.

Creamer also said the government should be credited for steering the economy through the economic crisis, and that tax breaks for small business were to be welcomed because of the broad-based potential of such an initiative.

In the run-up to the general elections, he said the various political parties' election manifestos needed to be weighed up against the economic realities set out in the budget.

 

Also making headlines:

Tunisia says it needs more help from its European partners in its transition to democracy, as the Arab Spring will fail unless the country’s transition succeeds.

The UN Security Council is urged to consider imposing sanctions against anyone who attempts to undermine Guinea Bissau‘s forthcoming general election.

Finance Minister Pravin Gordhan says government is concerned about the level of over-indebtedness of South African households.

And, US Secretary of State John Kerry likens Uganda’s anti-gay law to anti-Semitism and apartheid.
 

That's a roundup of news making headlines today.