South Africa

JOHANNESBURG – The South African government and business community need to closer align themselves to fully leverage the economic opportunities that come with belonging to the Brazil, Russia, India, China and South Africa (Brics) bloc of emerging economies, a panel of experts say at a Frontier Advisory post-Brics summit discussion. South African Institute for International Affairs (Saiia) CEO Elizabeth Sidiropoulos says South African business and government need to start working as a united force, much like the other Brics members, to position the country as a competitive but also a cooperative, force in the global market, especially in the growing African market. “We need to really work on developing SA Inc, to increase our competitiveness and improve productivity. Only then can we achieve objectives set out by the South African government to reduce unemployment in the country.” Almost a decade after Goldman Sachs economist Jim O'Neil coined the term Bric, based on the size, population and current and forecast economic growth of these countries, South Africa was invited to join this exclusive club, or as Frontier Advisory CEO Dr Martyn Davies now refers to them, the E5 (emerging five). Many commentators, including O’Neil, did not agree with South Africa’s inclusion in this grouping, but Webber Wentzel partner Peter Leon believes South Africa’s invitation is “all about the minerals”. “South Africa is sitting on the world’s biggest set of mineral resource with reserves worth $2,3-trillion. Further, in the context of the rest of mineral-rich Africa, South Africa has the most developed infrastructure and the deepest capital markets. “As far as an appropriate springboard into Africa goes, South Africa is the only game in town,” says Leon.

CAPE TOWN – An unfolding corruption scandal involving a South African minister's expensive trips to see his jailed mistress in Switzerland is expected to undermine the ruling party ahead of local elections next month. The African National Congress (ANC), which has had a stranglehold on politics since it took over when apartheid ended 17 years ago, is expected to roll to victory in the May 18 vote, but the scandal could cost it control of urban areas and undermine President Jacob Zuma as ANC rivals look to unseat him. Zuma, who pledged to stamp out corruption in Africa's largest economy when he took office two years ago, this week says he has noted media reports that Cooperative Governance Minister Sicelo Shiceka is suspected of spending R335 000 (nearly $50 000) in State funds to visit his imprisoned girlfriend. Shiceka, who is also being investigated for spending nearly $100 000 in State funds on stays for him and his staff at a posh Cape Town hotel, has not commented on the reports. His office says he has been on sick leave for several weeks. Corruption is nothing new in South Africa, with analysts saying it has become worse under Zuma. This has angered the ANC's base of poor blacks, whose fortunes have improved little since the party took over, as well as a growing multiracial middle class, who feel their taxes are being wasted. Analysts see the May election as the first where nonracial differences in class come into play in the country that suffered massive racial repression of nonwhites for most of the 20th century and expect them to grow larger in the years to come.

CAPE TOWN – The Department of Trade and Industry (DTI) announces that President Jacob Zuma has signed the Companies Amendment Act of 2010 into law, from May 1. Trade and Industry Minister Rob Davies says the new Companies Act has a number of features to it, which will improve the business operating environment in South Africa. “There is a reduction particularly on the regulatory burden on small-medium-micro enterprises. The requirement for financial reporting for small companies has been reduced considerably in that they do not have to produce audited financial statements, but will need to have financial reporting at an appropriate low level,” he notes. A significant innovation is the introduction of a business rescue scheme, which will mean that instead of companies going into major judicial management and subsequent bankruptcy, a rescue process will be initiated. Creditors could then be held at bay while stakeholders work to rescue the company. Davies points out that the new Act does not allow registration of close corporations (CCs), and therefore no new CCs will be registered when the Act comes into legal force. However, CCs that are already in the system will remain active indefinitely, unless they chose to convert into the new corporate regime of the Companies Act of 2008. “The Act does not apply retrospectively and those registrants who have already applied for CCs before May 2011, would still receive their certificates,” he says.

PRETORIA – The South African Police Service (SAPS) has distanced itself from a top secret intelligence report that allegedly reveals plots by a string of senior African National Congress (ANC) members to oust President Jacob Zuma as the party’s president at its elective conference next year. “The senior management of the SAPS would like to assure South Africans that the mandate of the SAPS to fight crime will never be perverted to serve any self-serving personal agenda or political interest under its watch,” says deputy national commissioner Lieutenant-General Godfrey Lebeya. “The work of the SAPS is under-pinned by such a rigorous system of checks and balances that this document would not have passed even a single of the many verification tests that documents of its nature have to go through for them to be entered into the organisation’s official register,” he adds. Hawks spokesperson McIntosh Polela says that the document has no status in the police department and has never been registered with any of its units for any purpose.

Africa & the world

PARIS – France promises Libyan rebels that it will intensify air strikes on Muammar Gaddafi's forces and send military liaison officers to help them as fighting rages in the besieged city of Misrata. Rebels say they fought progovernment troops for control of a main road in the port city of 300 000 that is the insurgents' last stronghold in the west of the country. Eight people had been killed the previous day, mostly civilians. "North Atlantic Treaty Organisation (Nato) warplanes are flying over Misrata but I do not know if there are strikes," a rebel spokesperson calling himself Abdelsalam says. "Nato has been inefficient in Misrata. Nato has completely failed to change things on the ground." Evidence has surfaced that Gaddafi's government is dodging United Nations (UN) sanctions to import gasoline to western Libya using intermediaries, who transfer the fuel between ships in Tunisia, a source with direct knowledge of the situation. One intermediary company, Hong Kong-based Champlink, previously unknown to the oil trading community, has sought a transaction for fuel delivery into Libya, according to a fax obtained by Reuters, and European oil traders say that they had been approached by other such firms. In Paris, French President Nicolas Sarkozy, who has spearheaded UN-backed Nato intervention, pledges stronger military action at his first meeting with the leader of the opposition Libyan National Council, Mustafa Abdel Jalil. "We are indeed going to intensify the attacks and respond to this request from the national transition council," an official in the president's office says, quoting Sarkozy as telling Abdel Jalil: "We will help you." He did not say how Nato-led forces plan to break a stalemate on the ground after the US and several European allies declined to join ground strikes.

HAINAN ISLAND – Africa needs $480-billion for infrastructure development over the next ten years, President Jacob Zuma says. “Over the next ten years, Africa will need [this much money] for infrastructure development, which should interest the Brazil, Russia, India, China and South Africa (Brics) business communities,” he said in an address for delivery at the third Brics leaders meeting at China’s Hainan island. “Already, Africa is projected as the third-fastest growing economy in the world, while the Brics countries now constitute the largest trading partners for Africa and the largest new investors. This economic relationship will be further strengthened as Africa forges ahead towards regional economic integration. This move will open up opportunities for more foreign direct investment and expanding trade relations with Brics countries.” He added that the African Union (AU) appreciated the Brics support of its roadmap “towards a viable political solution to the Libyan situation”. “The roadmap calls, besides others, for the cessation of all hostilities, implementation of political reforms to eliminate the causes of the current crisis, and an inclusive dialogue among the Libyan parties.”

ABIDJAN – Côte d’Ivoire’s President, Alassane Ouattara, has pledged to quickly restore security and prosperity to a nation broken by civil war as life in the main city slowly returns to a normality of sorts. In his first news conference since his rival, Laurent Gbagbo, was arrested, ending a power struggle which descended into all-out war, Ouattara promised to bring to justice all those responsible for atrocities, including his own forces. “I say to my countrymen, in a few months, the Ivory Coast will have come out of this crisis. Trust me,” Ouattara says. “We are still in a delicate situation. We still need to secure the country, especially Abidjan . . . I will do everything I can so that all Ivorians, everywhere in the country, can live safely.” He says a new republican army will be formed and urges militias and mercenaries who took part in the fighting to lay down their weapons. He says everything is in place to immediately resume cocoa exports – the West African State’s main foreign revenue generator – and that branches of the regional central bank, shut for months, will likely reopen, paving the way for private banks to do the same.

TRIPOLI – Britain pressured other North Atlantic Treaty Organisation (Nato) members to step up ground attacks in Libya but cracks appeared in the alliance as Foreign Ministers met in Qatar to try to break the deadlock in the civil war. Nato divisions surfaced at the international ‘contact group’ meeting, not only over arming the rebels and increasing air strikes but also on creating a fund from frozen Libyan assets to help the opposition trying to overthrow Muammar Gaddafi. United Nations Secretary-General Ban Ki-moon underlined the humanitarian disaster caused by the war, telling the meeting that up to 3,6-million people, or more than half the population, could need assistance. Paris and London are increasingly frustrated that air strikes have neither tipped the balance of the war in favour of rebels trying to end Gaddafi’s 41-year rule nor ended devastating shelling of the besieged city of Misrata.