For Creamer Media in Johannesburg, I’m Lumkile Nkomfe.

Making headlines: Ramaphosa reflects on government progress, notes slow pace of economic growth; Kganyago says South Africa cautious on rates to avoid regrets; And, Agri trade poised to benefit from South Africa’s global positioning next year, but BRICS needs work

Ramaphosa reflects on government progress, notes slow pace of economic growth

President Cyril Ramaphosa pointed out that strengthening local government is the Government of National Unity’s key priority, noting disruptions in the supply of electricity and clean water in many districts.

Ramaphosa wrote in his weekly letter to the nation that many local councils are plagued by “poor governance, limited capacity and severe financial constraints”, all of which are affecting service delivery.

Ramaphosa pointed out that the country has had over 250 days with no loadshedding, attributing this to a combination of increased maintenance and generation recovery by Eskom.

He said this was also owing to the addition of more capacity to the grid from renewables, and the large-scale uptake of solar and battery energy solutions by households and businesses.

He announced that the National Energy Crisis Committee is working to get more power onto the grid, to expand electricity infrastructure, to diversify the market for the benefit of consumers, and to lay the groundwork for an energy-secure future.

Ramaphosa highlighted that while government is making progress, it has a long way to go, noting the slow pace of the country’s economic growth.

Kganyago says South Africa cautious on rates to avoid regrets

South African Reserve Bank Governor Lesetja Kganyago said policymakers were proceeding with care on adjusting interest rates, to avoid having any future regrets.

Kganyago said in an environment of uncertainty it is very important for the central bank to move with caution and not add to the noise.

The central bank last month lowered its key interest rate by 25 basis points to 7.75%, even as some analysts called for a bigger cut after South Africa’s annual pace of inflation cooled by more than expected to 2.8% in October.

The rand, a bellwether for emerging market currencies, has depreciated almost 3% against the dollar since Donald Trump won the US election on November 5.

Investors are betting that his policies on tariffs and tax cuts may see the Federal Reserve lower rates by less than forecast. That could keep the US currency strong, which is bad news for South Africa as it makes its imports more expensive, adding to domestic price pressures.

With the 2024/25 season expected to benefit from La Niña rains, solid exports having been reported in the year-to-date, food price inflation having come down to 2.8% in October and the Agribusiness Confidence Index having increased by ten points to 58 in the fourth quarter of the year, experts are optimistic that the agriculture sector will grow meaningfully in 2025.

And, Agri trade poised to benefit from South Africa’s global positioning next year, but BRICS needs work

Agricultural Business Chamber of South Africaon Friday, CEO Theo Boshoff said the sector would benefit further from political stability effected by the Government of National Unity, progress with rail reforms, improved energy security and South Africa’s positioning within BRICS and in leading the Group of 20 next year.

The threats to the sector, however, include rising protectionism globally, geopolitical instability that impacts on prices and supply chain activity and green trade barriers.

Agbiz chief economist Wandile Sihlobo pointed out that the reaction of countries such as China to new import tariffs imposed by the US may cause disruption in the global agriculture market. Hence, he emphasised the importance of expanding agriculture exports into the new BRICS Plus member countries for diversification – including Egypt, Ethiopia, Iran and the United Arab Emirates.

China remains a vital market for South Africa’s agricultural exports, with China accounting for 10% of fresh produce purchases globally every year and the country continuing to have a deficit in its food balance.

That’s a roundup of news making headlines today

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