Covid-19 cases up to 1,326, 3 dead; Naspers gives R1.5bn to Covid fund; SA banks will help most clients; mines; diamonds

By Jackie Cameron

  • Covid-19 cases are up to about 1330, and three deaths have been reported. Naspers has joined donors digging deep to help the SA government prop up businesses as coronavirus containment measures hammer the economy. SA banks will help at least 80% of customers, and those who have kept up with debt repayments until now, according to a bank survey. South Africa’s biggest retail banks said around 15-20% of their borrowers may not qualify for coronavirus relief measures announced by the lenders last week, though more could be included if the government provided fiscal support. Banks contacted by Reuters on Monday said customers who would not qualify were those whose loans were already impaired prior to the outbreak of the respiratory pandemic. For more coronavirus-related news, download the BizNews Inside Covid-19 podcast, in which Alec Hogg shares the latest details on the pandemic.
  • SA Reserve Bank Governor Lesetja Kganyago has moved to dispel concerns that the authorities are overly worried by the Moody’s downgrading of the country to junk status. The Moody’s downgrade means South Africa is now assessed as junk by all three major ratings companies, after S&P Global Ratings and Fitch Ratings cut the country to sub-investment grade in 2017, and will fall out of the FTSE World Government Bond Index after April. That could prompt capital outflows and weaken the rand further, says Bloomberg. Reserve Bank Governor said on the same call the central bank is “crisis ready” and will step in when needed. “We have got the tools to deal with financial market stresses, we will not hesitate to deploy those tools in pursuance of our mandate” of financial stability, he reportedly said.
  • The South African government will throw resources into fighting Covid-19, including developing data and harnessing 3D printing to produce protective gear. Minister Blade Nzimande told a UNESCO Virtual Ministerial Dialogue on Coronavirus COVID-19: “We have reprioritized some of our national research and innovation programmes, mobilized our data scientists (including our capacity in theoretical physics and astronomy) and government has made some resources available to enable all this. “Much as we understand that some of the scientific interventions will take some time to provide answers, continues Nzimande, some immediate interventions are necessary. “As South Africa we are developing a central data base as a means of tracking the effects of the virus and provide appropriate responses; the need to understand the local epidemiology and natural history of the virus; and strengthening our 3D capabilities to support manufacturing of assistive devices like ventilators,” according to a statement  on the government communications website.
  • Emerging markets – not just SA – are volatile as coronavirus sweeps the globe; cracks are appearing across the emerging-market landscape like never before. So says Bloomberg, which reports that, as most nations brace for a likely surge in coronavirus cases, the signals from the developing world could hardly be more worrying for investors. Emerging-market stocks last week had their biggest rally since 2018 and currencies strengthened on the back of global stimulus measures, it says. “But a sense of foreboding lingers. JPMorgan Chase & Co.’s gauge of expected price swings in developing-nation currencies is headed for its biggest monthly jump since the height of the global financial crisis in October 2008. Equities are poised for their worst month since the crisis, too.” In the large emerging markets of the world economy — the likes of Brazil, Argentina, sub-Saharan Africa, India, Thailand, and Malaysia — the virus has yet to arrive at full strength, Adam Tooze, a Columbia University economic historian and the author of Crashed, an account of the 2008 crisis, wrote in Foreign Policy. “With their populations at risk, their public finances stretched, and financial markets in turmoil, many emerging-market states and developing countries face a huge challenge,” Tooze is quoted as saying.
  • Platinum miners are declaring force majeure on their contracts; diamond sales will stop until international Covid-19 containment measures ease. Anglo American said on Monday its diamond unit De Beers Group will not hold its third sales event because of lockdowns in Botswana, South Africa and India, and that it is considering options for online trade as global travel restrictions complicate traditional physical inspection of gemstones, says Reuters. The world’s largest platinum producers Anglo American Platinum, Sibanye Stillwater and Impala Platinum have declared force majeure on contracts after a three-week national lockdown forced operations to close, says the newswire. This allows it to wriggle out of otherwise legally binding clauses because of unavoidable circumstances.