TheBigPond - spotlight on what South African business and business people have been up to in Europe. Edited by South African journalist Christo Volschenk from Stuttgart, Germany. Note: This blog has migrated to a new home at www.thebigpond.eu.
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Spare a thought for Mbeki

A few years ago Thabo Mbeki would have been on his presidential plane long ago, on his way to broker peace in Africa's latest "konflikgebied", which is Kenya.

But, the conflict on his own doorstep has clipped his wings and now it's left to people like Kofi Annan to help, while Mbeki focusses his attention where he should have focussed it all along.

I guess one can speak here of a double-whammy. But, probably not (yet?) of a triple-whammy. The third being the "collapse" of the "African Renaissance", which Mbeki identified and named in 1999, or thereabout.

Should "the Renaissance" peter out into nothing, it would really be sad for Mbeki. Instead of a "dream deferred", Mbeki would then be known as "The Nightmare come true".

Another observation: If Zuma goes on for much longer as he has been for the past three weeks (flying to Davos, speaking at the JSE, refusing to speak to Tyson and in general just maintaining a far higher profile in the media than Mbeki, etc.), then a fall-out with Mbeki can't be far away.

In the last few days one sometimes wondered who was president of the country. All of this must be so tough for a power "verwöhnte" like Mbeki.

I wonder how much longer he will allow the nightmare to continue...
1.2.08 13:24


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The country where men are men and the ANC is divided

My take is: One should not be fooled by assurances that it's all peace, unity and solidarity in the ANC. My gut tells me the opposite is true - just below the surface things are boiling. The situation is actually very "sensitive" at present.

The biggest problem I have with this fight between the Mbeki camp and the leftist, communist-dominated Zuma camp, is that the latter wants to give the state a bigger role in the economy. It wants to centralize decisionmaking and fix prices in a number of key sectors, including the building and the health sectors. And this after the evidence is there for all to see that the state and its departments are completely ineffective. That the Zuma camp doesn't see the contradiction in its "solution" for the lack of delivery we've had under Mbeki, is shocking in itself.

But, it gets worse. That they haven't noticed what price-fixing does to supply, is shocking, because the socialist experiment with price-fixing played itself out over the past 15 years "under the noses of the ANC communists", so to speak. With devastating results for the people it was supposed to help.

I'm talking of Mugabe and his Zim paradise, of course. In the late 80s Mugabe thought (for the first time, if I remember well): 'I've had enough of these whities charging these high prices for their agriculture products....I'll show them...I'm going to fix prices.' So, he fixed prices at levels which he thought the people could afford, and lo and behold, a short while later there were no products on the shelves any longer, because producers can't stay in business if they get less for their products than it costs to produce them.

But, that was just a colonialist ploy. And so, the Big M went on with his price-fixing until all the shelves in all the supermarkets were empty. (It sounds a bit like a fairy tale, doesn't it...)

I guess one could call what Mugabe tried "a perfect failure". But, now a group of ANC members wants prices to be fixed in a number of sectors in South Africa! That sounds almost unbelievable, doesn't it, given the spectacular failure we've had with price-fixing on our doorstep.

So, one must conclude: Should the Zuma camp give the state an active, or leading role in the economy, the markets will probably get edgy and punish the rand.

Secondly, the war of words over the past weekend between Tito Mboweni and the "lefties in the corner" (read communists) is a clear indication that Tito is on his way out. There will be a different governor under Zuma. Who it will be (who it can be) is still unclear. And the markets will (definitely) remain nervous until the new governor has shown that he isn't soft on inflation (read: that he can make his monetary policy decisions free from political interference).

So, the situation is very delicate.

The next 15 months is shaping up to be a paradise for "armchair economists".
4.2.08 20:19


Stranger than fiction

South Africa is an unusual place. That's for sure. Some call it "A world in one country" and then they refer to the natural variety in the country. I think of it as "A world of economic ideas in one political party" and then I refer to the strange thing called the African National Congress (ANC), which is home to the full spectrum of economic ideas (well almost), from the "market-accepting" variety to the hardest nuts of the communist variety.

To put this phenomenon in perspective: In Germany there are at least 5 political parties over this spectrum - and don't think their members can be in each other's company for longer than a few hours at a time. Let alone be thrown together in a single political party!

But, in SA the communists live quite happily with their "market-accepting" brothers in a single political party. Strange....

From time to time one is reminded of this "strangeness". As over the weekend, when a communist-ANC member had this to say (in public) of another (very senior) member of his own party... (and, of course, no-one got rapped over the knuckles for saying it).

This article from Sapa:

'It's Mboweni who's talking rubbish'
February 04, 2008


JOHANNESBURG: Comments by Reserve Bank governor Tito Mboweni were nonsense, the Young Communist League said at the weekend.

"The YCL notes the dastardly comments attributed to the Reserve Bank governor, Tito Mboweni, as it relates to the 52nd National Conference of the ANC calls by delegates to ease inflation targets," said Young Communist League spokesman Castro Ngobese.

Ngobese was reacting to Mboweni's comments that some members of the ANC ruling party "talked a lot of nonsense".

Mboweni said: "At the central bank, we take our mandate from the government, not from whoever is talking from some corner."

Ngobese said: "Tito Mboweni is doing nothing but undermining the resolutions of the ANC.

"We call for the democratisation of the Reserve Bank and which accords civil society and political parties space to contribute."

End of quote.
4.2.08 21:33


Beginning of the end for Platter?

I salute Kobus Deetlefs of Deetlefs Wine Estate for taking a stand against the method used by the John Platter Wine Guide for allocating stars to wines.

The wine estate announced this week that it had withdrawn its wines from the 2008 edition of the Guide, because the star allocation was not done blind - the acknowledged best way of rating all over the world.

For the full motivation, go here:
http://www.wine.co.za/news/news.aspx?NEWSID=11270&Source=Newsfeed

This is a brave stance taken by Kobus. All the more so, because his wines have not been very successful to date in blind tastings. In fact, it seems as if his previous Platter ratings are better than most ratings given in blind tastings to date.

This makes the estate's stance an even stronger one, of course. And shows frivolous comments, such as the one from Grape magazine (www.grape.co.za), off for what they are: unaware of the significance of the event...

Because, this stance could be the beginning of the end of the Platter Guide as we know it. Unless it comes up with a solution to the problem soon (before this debate is allowed to escalate and before others follow the Deetlefs example).

Because, I'm sure there are many producers out there who have always felt like Kobus, but just haven't had the guts to come forward the way Kobus has...

In fact: If Platter doesn't respond appropriately and quickly to this complaint, the publication could be in trouble next year.

Even then this thing is destined to turn into a major debate in the coming weeks.

Afterthought: Sometimes, I can't believe how publications undermine their own "credibility" or "standing in their target community" by misjudging the seriousness of events - as Grape did with its frivolous response.

Another afterthought: My headline might be overstating the problem a bit and so undermine the credibility of my story, but what the hell.
5.2.08 11:09


What Mbeki should DEFINITELY say today...but probably won't

The red carpet is out, the people in the streets, the banners on the lamp posts (and let's forget the fires in the mountains for now).

All are ready and in festive spirit for the arrival of the politicians in Cape Town for the new legislative period. A big one, this is no doubt going to be.

My guess is, this will also be the one in which South Africa will produce another "first" for the Guinness Book of Records, namely: It will be the first time that a sacked deputy president of a country came back and effectively sacked the one who sacked him. Get it? I'm saying Mbeki won't survive this legislative period.

But, that's not the story of this story (not that it is not "major" enough to be the story of this story...just that I wanted to say something else when I started writing.)

Even more important today is that Mbeki assures the world about two things (in his State of the Nation speech which has just started now...).

The first being, that politics will not interfere in monetary policy decision making. In other words, that the central bank will be left alone to fight inflation the way it sees fit.

Secondly, Mbeki needs to re-iterate that there will be continuity in the Ministry of Finance. In other words, he has to state categorically that Trevor will not be thrown out under Zuma.

This is what he HAS to say to keep the markets calm...but probably won't.
8.2.08 10:16


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