Zuptoid propaganda machine at full revs as Zuma ups the ante

Zuma’s unexplained (not inexplicable) recalling of his finance chiefs from London in the midst of their strenuous attempts to keep the ‘junk status’ wolf from South Africa’s door has got the Zuptoid propagandists, not to mention spy-chiefs, hard at work. How else does one deal with the kind of insanity that would turn the average PRO’s hair grey overnight? Try and explain why else the rand fell 4.5% against the dollar overnight? Watch as Gordhan then shows up at his court appeal to call off the Guptas in their attempts to get him to prevent the major banks from blacklisting their accounts. He obviously thought saving the country from junk status was more important and left it to top lawyer Jeremy Gauntlett to handle that for him, though it seems Zuma disagreed. The Gupta-owned ANN7 brings in their top propagandist, so-called political analyst Botsang Moiloa, to publicly question the value of Gordhan and his deputy Mcebisi Jonas’s overseas roadshows. Moiloa blithely contends that their ‘frequent road trips’ have a ‘minimal contribution to economic transformation’. Talk about shifting the goalposts! It’s suddenly all about economic transformation (which is of course, the ANC’s dominant discourse) – forget about our credit worthiness, which Zuma and his Zuptoids seem intent on sabotaging at every turn to ensure their web of patronage and corruption stays in place, trapping every tender and kickback possible. Yet Gordhan, whose job (mind-bogglingly) will shortly be history as part of this agenda (Mr Moiloa please provide a more palatable, sensible agenda), is, in typical fashion, not taking this lying down. Treasury have responded in sober, reasoned tones, as this story illustrates. The spy-chiefs also weigh in, accurately reporting the dynamics, but attributing them to some kind of conspiratorial plot. Monty Python couldn’t do better. – Chris Bateman

By Matthew le Cordeur

Pretoria – National Treasury on Tuesday debunked various theories and queries about Finance Minster Pravin Gordhan’s investor trip to London and Deputy Minister Mcebisi Jonas’s cancelled trip to the US.

On Tuesday, BDFM editor-in-chief Peter Bruce referred in a column to a “by-now-typically-incoherent, intelligence report” alleging that Treasury was having secret meetings to start “operation check mate”, a move to avert the possible firing of Gordhan and Jonas.

President Jacob Zuma, Finance Minister Pravin Gordhan and business representative Jabu Mabuza at the Union Buildings in Pretoria.

“The bankers are going to be told that the Ministry of Finance and Treasury stand together against the president and the corruption of the Gupta’s,” a screenshot of the report inserted in the column said. “They will inform the banks that if they are fired the financial markets in South Africa will collapse and the rand will go to 18 to 20 to the dollar.”

The rand has weakened by almost 5% since President Jacob Zuma ordered him home from the roadshow on Monday.

Without referring to this allegation, Treasury on Tuesday made it clear that their investor roadshows to the UK and US were essential to keep the country afloat financially.

“Government on a weekly basis needs to borrow more than R13bn in the domestic market,” Treasury said in a statement on Tuesday. “Of government’s total borrowing requirement, $6bn needs to be raised in the international market over the next three years to partly meet government’s foreign commitments.”

Read also: Zuma tells SACP members: Pravin Gordhan is toast. I’ll be firing him soon.

“One of the clear benefits of the roadshows is that South Africa is one of very few countries that do not have to meet investors before issuing an international bond,” it said.

“In other words, the South African government is able to raise amounts as high as $3bn within a matter of three to five hours. This has been the case for the last five years now.”

As such, Treasury said it has to keep both rating agencies and investors informed about fiscal and monetary policy developments, more specifically and about topical contemporary policy issues in SA.

“This information is crucial for investors to commit the funds under their management by buying South African government bonds (by lending to the South African government) and form their opinions about SA’s credit worthiness and thus to pronounce on the country’s rating.

“The ratings in turn determine the cost at which SA will borrow the R730bn it will need to meet its borrowing requirement for the next three years.”

This explanation may also answer political analyst Botsang Moiloa’s concern with the investor roadshow.  

Appearing on Gupta-owned ANN7 on Monday, Moiloa questioned Gordhan’s “frequent trips overseas … have had minimal contribution to economic transformation in the country”.

He also questioned by Gordhan “regularly attends roadshows in London and the United States instead of with developing nations”. – Fin24

Source: http://www.fin24.com/Economy/treasury-debunks-theories-about-uk-investor-roadshow-20170329

National Treasury:

Finance Minister Pravin Gordhan, senior officials from the National Treasury and senior leaders of South African business held a series of scheduled meetings with rating agencies and investors in London on 27 March as part of official trips planned for the week. The trips are scheduled National Treasury’s annual domestic and international investor engagement roadshows broadly timed to follow immediately after the tabling of the Budget in February and the publication of the Medium Term Budget Policy Statement in October respectively.

The roadshow was scheduled to take place in two phases. The first phase was set to take place in London on 27 and 28 March. Minister Pravin Gordhan was leading the delegation, which also comprised of Mr Jabu Mabuza (of Business Leadership South Africa and Business Unity South Africa), Ms Nicky Newton-King (of the JSE). Mr George Sebulela from the Black Business Council could not make it due to logistical challenges.

As in the past international roadshow held late last year, leaders of the three labour union federations – COSATU, NACTU and FEDUSA – were also invited to attend. Due to logistical reasons, they did not make the first day of the meetings, but were told not to travel because the trip was subsequently cancelled. The Reserve Bank delegation which also traditionally joins the roadshows could not be part of it because of the planned Monetary Policy Committee meeting.

The second leg of the roadshow was intended to be in the United States, to be led by the Deputy Minister Mcebisi Jonas. However, this trip was subsequently cancelled before he travelled last night.

Treasurer Director General Lungisa Fuzile, Minister of Finance Pravin Gordhan and his Deputy Mcebisi Jonas.

In London, Minister Gordhan and his delegation had five face-to-face meetings with sixty representatives from the following fund managers: BlackRock, T.Rowe, Aberdeen, Eaton Vance, Vanguard, Investec, Metlife and Apollona, and 28 investors in a combined lunch. They also met two rating agencies (Fitch and Moody’s), as well as a teleconference with Standard & Poor.

The meetings are part of the normal course of business of the Treasury’s effort to keep both rating agencies and investors informed about fiscal and monetary policy developments, more specifically and about topical contemporary policy issues in SA.

The questions from both investors and rating agencies revolved around:

  1. Economic growth: Investors enquiring about the achievability or otherwise of growth forecasts and Government, business and other partners’ efforts towards achieving faster and more inclusive growth.
  2. Fiscal Policy: While broadly commending the budget, investors wanted to know whether there was still scope to adjust both revenue and expenditure sides of the budget in the event that the fiscal targets are likely to be missed materially.
  3. Politics: Investors expressed concerns about the political environment and the risk that it could divert attention from setting policies aimed at accelerating growth and creating more work opportunities. They were also curious about the processes leading to the policy conference of the governing party and the electoral conference in December.

This information is crucial for investors to commit the funds under their management by buying South African government bonds (by lending to the South African government) and form their opinions about SA’s credit worthiness and thus to pronounce on the country’s rating. The ratings in turn determine the cost at which SA will borrow the R730 billion it will need to meet its borrowing requirement for the next three years.
Government on a weekly basis needs to borrow more than R13 billion in the domestic market. Of government’s total borrowing requirement, $6 billion needs to be raised in the international market over the next 3 years to partly meet government’s foreign commitments. This is money that will contribute towards the building of public infrastructure – roads, schools, health facilities, etc – to deliver better public services to the 55 million South Africans.

One of the clear benefits of the roadshows is that, SA is one of very few countries that do not have to meet investors before issuing an international bond. In other words, the South African government is able to raise amounts as high as USD3 billion within a matter of 3-5 hours. This has been the case for the last 5 year now.

The meetings commenced at 10am and ended at 18h00 before the team headed for the airport to catch their flight back home.