WAR IN EUROPE
South Africa risks losing $32bn on Russia stance, Stanlib says
South Africa stands to lose as much as $32.4-billion in export revenue, almost a 10th of its gross domestic product, should some of its main trading partners retaliate against its unwillingness to take a stance against Russia’s war in Ukraine.
‘Together, the EU and US account for 30.4% of total exports by South Africa,” compared with Russia’s 0.23%, or 0.07% of GDP, said Ndivhuho Netshitenzhe, an economist at Stanlib Asset Management, an investment manager with more than R650-billion in assets under management. This means, she said in a note, that should geopolitical tensions escalate, and the West acts against South Africa, it could lose up to R612.7-billion in export revenue.
South Africa says it has adopted a non-aligned stance on the war in Ukraine and has abstained from several United Nations votes condemning Russia’s invasion.
This neutrality has become “seemingly compromised” as the nation consistently interacts with Russia through diplomatic and military channels, Netshitenzhe said.
The rand’s performance is unsurprising as South Africa has systematically lost investor confidence.
In February, South Africa held naval exercises with China and Russia. The manoeuvres were criticised by the US and the European Union, who questioned the timing – one year after Russia launched its invasion of Ukraine.
Read more from Daily Maverick’s Russia-Ukraine archive
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Last month, a diplomatic row broke out between South Africa and America over accusations by US ambassador Reuben Brigety that Pretoria supplied arms to Russia. The allegations were denied and Finance Minister Enoch Godongwana said the spat was resolved.
The increased risk and perceived closeness to Russia is likely to drive foreign investors out of the country, Netshitenzhe said.
Read more in Daily Maverick:
Reserve Bank warns of a shock to the system over SA’s ‘neutral’ Russia-Ukraine stance
Ramaphosa to call China’s Xi while Cabinet silent on moving BRICS Summit
Foreign ownership of government bonds fell to 26% by April from as high as 43% in 2018, she said, and the rand is the third-worst performing emerging market currency against the dollar this year.
“The rand’s performance is unsurprising as South Africa has systematically lost investor confidence,” she said. “South Africa’s poor policy choices, weak economic performance and ineffective political leadership [have] contributed to increased capital outflows.” DM
And just imagine the bloodbath, in terms of lost jobs, this would unleash. It would tear the country apart.
But really does the Government (ANC) care?
2 answers to 1 question , the cadres look after themselves , not well . unless at top of the food chain , the rest of the country , tough . New water deals and an unworkable NHI ! As long as they have a majority they only care about themselves .
I do not believe that SA’s involvement with Russia devalue the ZAR nearly as much as the myopic economic policies of the ANC-run government. This government’s obsession with BEE is short sighted and self destructive.
Spot on.
Just what is our involvement with a country that went to war , destroying all in its path ? Missile strikes to hospitals and schools .
Yes the anc has not helped the currency for many years ignoring questions about the Lady R for many months , led to the US ambassador going public, tanked the rand again .
“South Africa’s poor policy choices, weak economic performance and ineffective political leadership” ..
… leads to increasing poverty and declining well being for the generality of South Africans ..
self-rule is not meant to mean “rule so as to benefit my-self”.
The ANC is a big disappointment to all of Africa … another corrupt incompetent government looking out only for “myself”.
The leaders in the ANC from Ramaphosa down are simply too pig headed and short sighted to grasp the enormous consequences of their siding with Russia against our friends in the West. The wreckage they leave behind when they lose the elections in 2024 will prove to be an almost insurmountable task for any new (coalition?) government to rectify. If the DA is a leader in any such coalition that will be our only hope. There is simply no other party capable of coming close to the will, the required work ethic, and the ability to understand the logistics and remedial action required to reverse the ongoing destruction of our country by the ANC.
Well said, couldn’t agree more. But many people will choose not to vote for the DA because of some arbitrary political disagreements or perceived minor past transgressions. Let’s hope a more practical attitude takes root in the voting public in the next year.
Or maybe they’re just as racist as they call the ‘white-ruled DA’. Oh sorry, blacks can’t be racist…
Has anyone told Cyril about this , assume he will be shocked to hear , as usual .
The down side for non cadres is clear to see .
Yes , you do get judged by the friends you keep .
With respect , Putin is a puppy compared to Xi !
So what is the deal for the ANC , self enrichment we know , how?
What does Russia have that we can use ?
Oil and gas only .
Just where do our supplies come from ?
Brent continues to drop to just over $70 / barrel , while Russian oil is going for about $60 / barrel for China and India , BRICS 🙂
Back in the days of sanctions , Norway supplied 10 % of our oil .
Until someone found out and the Norwegian govt collapsed . All petroleum deals were censored back then .
Maybe I am wrong , Russian tankers are not off loading @ $60 barrel , the ANC sells $70 + alloff to Dubai .
Lady R did not dock by accident . most large ships have tracking devices .
Will ask around , just where our oil etc comes from , tankers have to dock and offload , are our suppliers still secret ?
We still know MY Nord is still hanging around in the Maldives / Seychelles area , not so welcome in a national key point as the lady R .
Things have changed since the Norwegian nightmare , most maritime vessels have an identification system , which can be tracked .
I will ask those who know more .
I just expect the WORST from the anc !