SA job losses galore; IMF downgrades growth; new bank for SA; palladium

By Jackie Cameron

  • The International Monetary Fund (IMF) has adjusted its growth forecast for South Africa for 2020 and 2021 downwards. The IMF now sees the economy growing at 0.8% this year, down from a previous forecast for 1.1% growth, and 1.0% in 2021, down from an earlier prediction for 1.4% growth.
  • As the South African economy continues to take strain, companies have warned of job losses. The IT sector and chrome businesses are among the latest to lay off people. Many South African technology and telecommunications companies are firing workers, and this is set to continue in the coming year, says My Broadband. Massmart announced earlier this month that it is set to shed more than 1,000 jobs, while Telkom could axe more than 3,000 people. Also warning of looming job cuts are South African chrome firms which said on Monday that more than 1,200 jobs could be slashed. Goldman Sachs, meanwhile, is expanding its operation in South Africa. It announced it has got approval from South African regulators to operate a bank, as the Wall Street firm seeks to tap into fast-growing economies on the continent.
  • SAA is still flying, even though the government has missed its deadline to provide a fresh financial injection. SAA said all flights are operating normally as the government looks for ways to provide R2bn in funding for the national carrier, which is in a form of bankruptcy protection. While there may be “flight schedule amendments” in the future, SAA says details of those changes will be announced when finalised, as Bloomberg reports.
  • As the world’s elite gear up for their annual gathering in Davos, it has emerged that a special clean fuel for planes is being laid on to put paid to flight-shaming. The hundreds of private jets expected to fly people out from the annual World Economic Forum (WEF) will be able to fill their tanks with fuel designed to lower carbon emissions, as the annual global talk shop aims to beef up its green credentials, reports Bloomberg. So-called sustainable aviation fuel, or SAF, will be available at Zurich airport, according to a statement Monday from a coalition of groups representing business jet operators, manufacturers and fuel suppliers. “A 30% blend with conventional jet fuel can lower CO2 emissions by about 18% on a comparable 1,000-nautical-mile flight, the group said on its website,” says Bloomberg. Private jets — a staple of Davos — have become a lightning rod for the flight-shaming movement, with the global elite criticized for spewing unnecessary emissions by avoiding commercial flights, says the news agency. “Promoting alternative fuels could help ease the mounting pressure against business-jet use, as well as for the broader aviation industry, which faces a potential end to European Union tax exemptions for jet fuel,” it says, adding that carbon output from international aviation has more than doubled since 1990 and the United Nations has said the industry is set to overtake power generation as the single biggest CO2 producer within three decades. You can keep up-to- date with what’s happening in Davos, on BizNews.com.
  • It was an exciting ride for palladium investors at the start of the week. Prices swung between gains and losses on Monday, after surging to a fresh record of $2,577.27 an ounce as tight supply conditions show little sign of easing, says Bloomberg. The metal pared some of its gains in the afternoon as a holiday in the US depressed activity in most major markets.