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Polity
Article by: Amy Witherden
Published: 12 Dec 2008
Daily podcast - December 12, 2008
Friday, December 12, 2008
From Creamer Media in Johannesburg, I'm Shona Kohler.
Making headlines:
The repo rate was cut yesterday by 50 basis points, following the meeting of the Monetary Policy Committee of the Reserve Bank. The repo rate is now 11,5% while prime is 15%.
Standard Chartered Bank says that the rate cut was "the right thing to do". Razia Khan, regional head of Research Africa, explained that this is because of the slowdown in growth, the receding risks to higher inflation, at least in the near term, and the inappropriateness of the previous monetary policy stance. The key focus now will be the pace of the Reserve Bank easing cycle that is underway. Khan added that the economy needs this rate cut. She says that the bond market will be cheered by it, and that the rand is expected to benefit as a result.
The Congress of South African Trade Unions is, however, "deeply disappointed" that the MPC has reduced the repo rate by only one-half a percentage point. The Central bank has missed a great opportunity to make a substantial cut in interest rates, Cosatu said. This could have helped to counter the massive danger of retrenchments, and an economic slump in the wake of the global economic meltdown. Such a small reduction will have a minimal impact on individuals battling to repay loans and bonds, and on businesses struggling against the combined effects of the ten previous interest rate increases, and the impact of the world economic crisis.

In other South African news, the newly formed Congress of the People has secured its first public representatives, but it was the Democratic Alliance that emerged triumphant from Wednesday's by-elections.
In the Western Cape, where the African National Congress's hold on power is most tenuous, the DA won nine of the 18 wards previously held by the ruling party. Party CE Ryan Coetzee says that it is clear that the DA is on track to win the province, and if not, to be the biggest party in the Western Cape "by quite some distance".
The ANC said that while it was pleased with its wins elsewhere in the country, the Western Cape results posed "a significant challenge" to the party. Western Cape chairperson Mcebisis Skwatsha, said the party would ask the Constitutional Court to nullify the results in wards where the Independent Electoral Commission had turned away ANC candidates who did not meet the registration deadline. The reason for their complaint is that the ANC feels its exclusion "disenfranchises tens of thousands of voters."
The IEC reported that the ANC and the DA each won 11 seats nationwide, with ten seats going to independent candidates, all of whom are Cope representatives.
University of the Witwatersrand political analyst Susan Booysen, said that Cope would probably have made more of an impact if its name had been on the ballot paper. She added that if there was one victor in the by-elections, it was the opposition as a whole. These results signal a loosening in the party-political landscape.

In Zimbabwean news, the US thinks that Zimbabwe's President Robert Mugabe could be forced to step down, if South Africa and its other neighbours took the bold step of sealing their borders. The US has been pushing African States, particularly the 15-nation Southern African Development Community, to take firmer action on Zimbabwe.
Zimbabwe's neighbours are divided over what approach to take, with Mugabe still viewed by many as a hero for liberating the country from white minority rule. This week, the African Union rejected tougher action in favour of more dialogue. A senior US official said the solution is simple and Mugabe must be ousted. He said that a popular uprising to get rid of Mugabe was unlikely, as the "real risk-takers" had already fled to neighbouring countries to seek work.
The US explained that closing the borders would bring Zimbabwe to its knees within a week.
The US ambassador to Zimbabwe, James McGee, said that the country is rapidly becoming a failed State. He also blamed the cholera crisis on the government's mismanagement, saying it is "man-made."

Also making headlines:
The Pretoria High Court is to rule on the name dispute between Cope and the ANC today.
A World Bank economist says that world trade is in a rapid dive.
UN chief Ban Ki-Moon says that the world needs a ‘Green New Deal'.
And, diplomats believe that the World Trade Organisation talks need a positive signal from US President-elect Barack Obama to avoid failure.

That's a roundup of news making headlines today. Creamer Media would like to wish its podcast listeners a happy festive season and a prosperous 2009. We will resume podcasts in the New Year.