By Jackie Cameron
- Sasol’s share price jumped when its CEOs jumped ship. It rose about 12% on Monday. The board decided a leadership reset was needed following a bad investment in the US. Sasol named a new chief executive officer to replace co-CEOs Bongani Nqwababa and Stephen Cornell as the company seeks to draw a line under the disastrous development of an almost-$13bn chemicals plant in the US, reports Bloomberg. The probe showed that the Lake Charles project management team acted inappropriately, lacked experience and were overly focused on maintaining cost and schedule estimates instead of providing accurate information. Sasol didn’t find misconduct or incompetence by either of the outgoing leaders, who will be replaced on November 1 by Fleetwood Grobler, previously executive vice president for chemicals, says Bloomberg.
- South Africa’s tenuous hold on the stable outlook on its sole investment-grade credit rating may slip with Finance Minister Tito Mboweni expected to show a marked deterioration in the state of the nation’s finances this week. Of the 17 economists in a Bloomberg survey, nine forecast that Moody’s Investors Service will change its outlook on the nation’s credit rating to negative before the end of the year. While the focus will be on the budget and how the government will rein in debt that’s fast approaching 60% of gross domestic product, investors and ratings companies are also looking out for long-awaited structural reforms by President Cyril Ramaphosa’s government. Mboweni is expected to soon release an updated version of his August economic policy paper that proposes a raft of steps to boost economic growth.
- Palladium surged to a record, topping $1,800 as stricter air-quality rules boost demand for the metal used in vehicle pollution-control devices. Spot prices climbed 2.1% to $1.802.24 an ounce at 11:09am in New York, says Bloomberg, adding that the metal is up more than 40% this year. Production of platinum-group metals in South Africa shrank the most in 18 months in August, while growth in Russia stalled last month, government data show. Power outages in South Africa have helped cloud the supply outlook for palladium. There’s been concern that palladium’s hefty price could prompt automakers to find lower-cost materials for their pollution-control equipment.
- South Africa has been battling lengthy power cuts; now water cuts are on the cards. The country can avoid rolling cuts in water supply if citizens stick to restrictions in usage, Water Minister Lindiwe Sisulu said. Water Services, which is the country’s biggest water utility and supplies Johannesburg, said Oct. 23 it will raise usage restrictions due to high demand. So-called stage 2 involves slowing the output from reservoirs, it said. The restrictions apply nationally, Sisulu said. South Africa is a water-scarce country and recorded the lowest annual rainfall in more than a century in 2015. It battered agricultural output and saw gross domestic product shrink. Spring rains are late and are only expected in December, Sisulu said, adding that dry seasons are getting longer, more intense and more frequent, with rain more difficult to predict.
- Prime Minister Boris Johnson accepted the European Union’s offer of a three-month Brexit delay to Jan. 31, removing the risk of a damaging no-deal split on Thursday as his government tries to end the impasse in Parliament.
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