In an interview with BizNews editor Alec Hogg on this morning’s BizNews Briefing podcast, market expert David Shapiro discussed critical issues affecting the South African cement industry and the implications of the upcoming US presidential election. He expressed concerns about the cement industry’s future amid a shift towards alternative materials and emphasized the need for government infrastructure investment. Shapiro also addressed the challenges facing Tongaat Hulett in business rescue and reflected on the potential impact of political stability with a new US leader.
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In a recent interview on the BizNews Briefing podcast with host Alec Hogg, veteran market commentator and Chief Investment Strategist at Sasfin Wealth, David Shapiro shared his insights on a range of pressing topics, from the state of the cement industry in South Africa to the implications of the upcoming US presidential election.
Cement Industry: A Rocky Road Ahead
The discussion began with a focus on Sephaku Cement, a company linked to the Dangote Empire and one that Shapiro noted has recently shown signs of improvement. However, he emphasized the broader challenges facing the cement industry. “Cement is a difficult industry to follow at the moment,” Shapiro stated, referencing the ongoing struggles with imports and a lack of investment. He highlighted a global shift away from traditional cement use, noting that modern construction is increasingly relying on alternative bonding agents. “The way they put up houses now is almost like Lego sets,” he explained, suggesting a need for the industry to adapt to these changes.
Alec Hogg echoed Shapiro’s concerns, pointing out that infrastructure spending by the government could provide a lifeline for the cement sector. However, Shapiro remained sceptical about immediate improvements, pointing out that significant infrastructure development is lacking in South Africa. He underscored the importance of monitoring demand, particularly through companies like PPC and Cashbuild, to gauge the industry’s trajectory.
Hope for Tongaat Hulett
Shapiro and Hogg then turned their attention to Tongaat Hulett, a company currently in business rescue for two years. Shapiro expressed cautious optimism, asserting that the company’s significant workforce in KwaZulu-Natal means its survival is crucial. “There has to be hope for the simple reason of the number of people that they employ,” he said, urging stakeholders to take action to prevent a collapse that would have devastating effects on local communities. He criticized banks for their reluctance to engage in risk-taking, suggesting that they have a duty to assist in the rescue efforts.
“There’s got to be a little bit of a push to say we have to get it done,” Shapiro remarked, emphasizing the critical nature of the situation for the economy and the workers involved.
Sassfin’s Future and Market Sentiments
The conversation then shifted to Sasfin, where Hogg inquired about recent developments following some turbulence within the company. Shapiro reassured listeners that despite the challenges, Sasfin has secured funding through a deal with African banks, which he believes will stabilize the business. He reflected on the unpredictable nature of market perceptions and how they impact operations, saying, “I can still afford fresh bread on Fridays.”
Shapiro acknowledged that headlines can be destabilizing but emphasized his commitment to maintaining a steady focus on the market and delivering for his clients.
The US Presidential Election: Risks and Uncertainties
A significant portion of the discussion revolved around the upcoming U.S. presidential election. Shapiro articulated concerns about Donald Trump’s polarizing presence in American politics, stating that Trump lowers the bar for presidential conduct and promotes division. He argued that a president like Kamala Harris might offer a more stabilizing force during a tumultuous time in global politics, allowing for a period of calm and reflection.
Shapiro highlighted the dangers of Trump’s leadership style, expressing hope for a more measured approach under Harris. “We want a period of calm,” he asserted, suggesting that the current geopolitical climate necessitates a leader who can foster unity rather than discord. He compared the current political climate to that of historical American figures like Abraham Lincoln, emphasizing the stark contrasts between past and present leadership standards.
Conclusion: Navigating Uncertain Waters
As the conversation concluded, Shapiro’s insights painted a picture of an uncertain future, both in the South African cement industry and in global politics. He urged stakeholders to remain vigilant and proactive in addressing the challenges ahead, from local economic conditions to international relations shaped by U.S. electoral outcomes.
David Shapiro’s expertise continues to shed light on the complexities of the market and the political landscape, providing a voice of reason amid the fluctuations and uncertainties that characterize today’s economic environment
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