The economy. Sars. African Bank. 2017 was the year when business news, usually a niche market, became mainstreamed. City Press’s Business editor Justin Brown sifted through the hundreds of notable articles to bring you his top 9 of the year:
1. PPC’s Chinese workers under scrutiny – February 5
The state’s investigation into how 242 Chinese nationals obtained permission to work and live at a North West plant owned by cement giant PPC was set to ramp up in February when the directors-general of home affairs and labour were meant to make another joint inspection of the site.
Mkuseli Apleni, director-general of the department of home affairs, and Thobile Lamati, his counterpart at the labour department, visited PPC’s Slurry plant, a source close to both departments said.
Read: PPC’s Chinese workers under scrutiny
2. Revenue service could miss by billions – April 16
There was a significant risk that the SA Revenue Service (Sars) would miss its revenue target for the year to March 2018.
The worst-case scenario was for the goal to be missed by as much as R53 billion.
Read: Revenue service could miss by billions
3. African Bank looks to fire 652 staff – May 21
In May, African Bank issued notices to its staff related to a restructuring plan which threatened see as many as 652 staff members retrenched, a source told City Press.
“About 650 employees at African Bank will be retrenched. This is after the bank was rescued by government from liquidation,” the source added.
Read: African Bank looks to fire 652 staff
4. Kganyago defends inflation targeting – July 2
In the event of any adjustment to the South African Reserve Bank’s inflation target range, we should see the target narrowed rather than widened, said bank governor Lesetja Kganyago in July.
“The discourse has to be able to bring inflation down. Higher inflation results in higher costs in terms of output and employment,” he said.
Read: Kganyago defends inflation targeting
5. Lagging collections could lead to tax hikes -– July 9.
Battered South African consumers faced the possibility of another credit crunch. This would be the result of lagging tax collection, which could see government try to find new ways to plug its revenue gap. Consequently, tax hikes next year could well be an option.
Raising debt to plug any tax shortfall could be another option government could pursue, but this would place pressure on the country’s credit rating, which was downgraded to “junk” status in April. Cutting expenditure is in all probability the least likely avenue the state would pursue to balance its books.
Read: Lagging collections could lead to tax hikes
6. Gigaba’s action lacks substance – July 16
The critical appraisal of Finance Minister Malusi Gigaba’s action plan announced in July was that it lacked substance, detail and would ultimately be judged on its tangible action and results, especially an improvement in economic growth.
Two major trade union federations slated the plan, while business was cautiously encouraging, but unconvinced. The three key ratings agencies adopted a wait-and-see approach.
Read: Gigaba's action plan lacks substance
7. How to avoid the IMF – October 29
In October City Press reported on Finance Minister Malusi Gigaba and the government needing a politically palatable plan to get out of the low-growth debt trap and avoid the country’s finances going to hell.
This picture was driven by poor growth and massive debt that could see South Africa slide further into “junk” credit rating status and even seeking an International Monetary Fund (IMF) bailout from 2022 onwards.
Read: How to avoid the IMF
8. Steinhoff hits junk as R282bn in value is lost – December 10
Investor fear caused Steinhoff and another seven companies associated with billionaire Christo Wiese to lose as much as R282 billion in market value in early December.
This was prompted by concerns over accounting irregularities and possible fraud at the furniture and household goods retailer.
Read: Steinhoff hits junk as R282bn in value is lost
9. Now Deloitte faces double probe – December 17
Deloitte South Africa is facing a double whammy of being probed for its role as Steinhoff International’s auditor and a disciplinary hearing for its work at the time of African Bank’s failure.
This made it the second of the Big Four auditing firms to come under scrutiny, following similar action against KPMG over its role in state capture and compiling a controversial SA Revenue Service report.
Read: Now Deloitte faces double probe