DIRCO Deputy Minister Luwellyn Landers notes achievements of BRICS in Africa

The Department of International Relations and Cooperation (DIRCO) in partnership with the South African Institute of International Affairs (SAIIA) held a media briefing on Monday evening to talk about BRICS in Africa. The event was themed ‘Working towards the Realisation of the African Aspirations.”

Key speakers for the meeting were DIRCO’s deputy Minister Luwellyn Landers and India’s Former  Commerce Minister Anand Sharma.

Deputy Minister Landers stated that South Africa’s membership of BRICS will further demonstrate tangible achievements and benefits for the country and the African continent.

Landers noted that 2018 is a very important year for South Africa, being the host nation of the 10th BRICS Summit in July, while simultaneously commemorating Nelson Mandela’s birth centenary.

“This is an opportune time to again reflect on the important pillars of our foreign policy that Nelson Mandela identified in 1993 when he penned an article title South Africa’s Future Foreign Policy: New Pillars for a New World. He added that “economic development depends on growing regional and international economic cooperation in an interdependent world.”

The deputy Minister believes that South Africa’s foreign policy outlook is predicated on African history and identity.

“We are Africans by birth and therefore our country belongs to this continent and not as a result of geographical composition. In the same vein you will appreciate that Africans are part of the Global South comprising in the main by countries which were colonised and citizens who we subjugated for a long time.” Landers said.

He added that these shifts and changes on the global sphere is in line with the African Agenda.

“The unity and renewal of our African continent must be pursued together with efforts to transform the global system. Humanity can thrive when their collective and individual interests and aspirations are responded to and the BRICS formation is titling the balance of forces to ensure exactly that.”

Landers also mentioned that the country’s most grave and pressing challenge is youth unemployment.

During his State of the Nation address, President Cyril Ramaphosa pointed out that young South Africans will be moved to the centre of the country’s economic agenda.

“I am certain that this can be achieved within the ambit of the intra-BRICS cooperation work programme, as contained in the BRICS Action Plan. Similarly, we want to see deepened engagements with the South African BRICS Business Council, the BRICS Civil society, and Academic community.” Landers added.

 

 

 

 

SARS Hosting: Meeting of BRICS Experts on Tax Matters and Heads of Tax

From the 18th to 21st of Junes The South African Revenue Service (SARS) will hosting the tax experts and heads of tax administrations from BRICS member countries, namely Brazil, Russia, India China and South Africa, taking place at the Hilton Hotel in Sandton.

The BRICS Tax meetings follow on BRICS Customs meetings held in April this year, which contributed to creating an enabling framework for BRICS Customs cooperation.  To build further on this gain, the BRICS Tax meetings will discuss contemporary tax issues such as the improvement of tax enforcement technology with a focus on the Fourth Industrial Revolution.

Digitalization is regarded to be the most significant development of the world economy since the industrial revolution. This development creates opportunities for innovation, investment, new business, jobs, and it is one of the main drivers of sustainable development. However, the taxation of the digital economy has not fully reflected the advantages created by the spread of technology.

This meeting will also explore new approaches to taxation governance and economic and technological cooperation which is expected to contribute significantly to the improvement of a global economic governance system.

At the closing of this meeting, SARS Acting Commissioner, Mark Kingon, will host a special media briefing on Thursday, 21 June 2018 to announce the outcomes of the meeting as well as any agreements reached.

Press Release Issued by: SARS Media Department

South African lobby group opposes parts of new draft mining charter

The Minerals Council of South Africa has rejected some elements in the latest draft of an industry charter, including a stipulation that 1% of the core profit is paid to communities and employees.

The draft showed that South Africa is planning to raise black ownership at permit-holding mining companies to 30% from 26% within five years.

However, the Minerals Council said in a statement that the raised target was never agreed on as a recommendation.

“The Minerals Council does not support this top up, as it prejudices existing rights holders that secured their rights on the basis of the 2004 and 2010 Charters,” the statement said.

The Minerals Council believes that much more work needs to be done to create a Mining Charter that promotes competitiveness, investment, growth and transformation for the growth and prosperity of South Africa.

A spokesperson for the Mineral Council South Africa, Charmane Russell, said the imposition of a free carried interest must be weighed against the need to attract investment for growth and employment creation.

“Given South Africa’s mature mining sector, a 10% total free carried interest on new mining rights will materially undermine investment, by pushing up investment hurdle rates and ensuring that many potential new projects become unviable,” Russel said.

Minister of Mineral Resources, Gwede Mantashe said in two weeks the department will host a summit to receive further input from stakeholders.

Source: Reuters

India & China looks to form ‘Oil buyers’ club’

India and China are in discussions to create an ‘oil buyers’ club’ that negotiate better prices with oil exporting countries.

India’s Petroleum Ministry said they will be looking to import more US crude oil to reduce OPEC’s (Organisation of the Petroleum Exporting Countries) control over the global oil market and prices.

“With oil producers’ cartel OPEC playing havoc with prices, India discussed with China the possibility of forming an ‘oil buyers club’ that can negotiate better terms with sellers as well as getting more US crude oil to cut dominance of the oil block,” the Ministry said.

India’s ministry met with ambassadors of OPEC countries to discuss India’s growing position in the world energy demand, along with the need for responsible pricing which balances the interests of both the producer and consumer countries.

India’s Petroleum Minister Dharmendra Pradhan said: “Further we also raised the issue of discriminatory pricing in global oil & gas trade through measures such as Asian Premium. Urged the OPEC Ambassadors to reconsider these discriminatory measures in the overall interest of all the countries & work together for a sustainable future.”

To further discuss the oil market and pricing issues, the Indian oil minister plans to visit Vienna next week to take part in the 7th OPEC International Seminar.

 

 Source: Russia Today

Young People influencing the economy of BRICS

Entrepreneurship is an important component in building an economy of a country, thus so much emphasis is always placed on it when development plans are made. Youth entrepreneurship is important for both the future of BRICS and development, looking at the following young people who are doing great things in their countries with entrepreneurship:

India
Kavita Shukla
Inventor, Designer and Entrepreneur, Kavita Shukla is the founder & CEO of The FreshGlow Co. and also the inventor of FRESHPAPER, a simple innovation taking on the massive global challenge of food waste.

China
Wang Xinwen
Wang found is the founder of Lilith Technologies. His company’s flagship mobile game immediately became a hit nationwide. The game ranked third by downloads on the Apple Store only three months after launch. The company’s market value is estimated to exceed $5 billion so far.

Russia
Marina Kolesnik
Following a consulting career at McKinsey and management role at DataArt where she headed complex software development projects, Marina Kolesnik has launched her own online venture Oktogo.ru. Since then, Marina raised $15 million in venture capital from European and Russian investors to make Oktogo.ru Russia’s leading online hotel booking and travel site or the “Booking.com of Russia.”

Brazil
Bel Pesce
Bel Pesce opened a school, FazINOVA, which is dedicated to helping students, both in live courses in Sao Paulo, Brazil, and online to persevere toward their dreams. The school has grown tremendously since its establishment in 2013.

South Africa
Siya Beyile

Siya Beyile is a Style enthusiast, creative director and all-round artist, he is the founder of men’s fashion portal The Threaded Man. Through The Threaded Man he has been a creative direction for events like the South African Music Awards and African Fashion International Fashion Week, and advertorials for the likes of Nivea.

Press Release: European Commission and ECB staff conclude the eighth post-programme surveillance mission to Portugal

Staff from the European Commission, in liaison with staff from the European Central Bank, visited Lisbon from 5 to 12 June to conduct the eighth post-programme surveillance (PPS) review for Portugal. Staff from the European Stability Mechanism participated in the meetings on aspects related to its Early Warning System. The main objective of PPS is to assess the country’s capacity to repay loans granted under the former EU-IMF financial assistance programme and, if necessary, to recommend corrective actions.

Following strong growth of 2.7% in 2017, the economic expansion is expected to moderate somewhat to rates broadly in line with that of the euro area. Overall, real GDP growth remained broad-based and employment continued to grow strongly, bringing down the unemployment rate below the level recorded for the euro area. GDP growth is expected to remain buoyant in 2018 but to moderate further afterwards. Risks to the outlook have become more prominent, in particular stemming from external factors, and have been accompanied by increased volatility in bond markets.

The current favourable macroeconomic and financial conditions provide an opportunity to accelerate structural reforms, further reduce macroeconomic imbalances and increase Portugal’s resilience to shocks. In particular, elevated public and private sector debt weigh on growth and leave the economy vulnerable to adverse shocks and to a turn in the business cycle. Moreover, productivity compared to many euro area countries remains low and remaining rigidities in the economy present obstacles for resources to flow into more productive activities. An ambitious reform agenda strengthening skill levels and incentives for productive business investment would also invigorate the convergence of per capita income to the euro area average.

Further fiscal consolidation will be important for ensuring a steady decline in the still very high public debt level. The current favourable cyclical conditions together with the decline in interest payments should be used for further structural adjustment to build up fiscal buffers. The commitment of the Portuguese authorities to use windfall gains to reduce the general government debt ratio is therefore welcome. However, the currently planned structural adjustment is at risk of deviating significantly from the requirements of the Stability and Growth Pact. This strengthens the case for containing expenditure growth, including by more efficient spending and expenditure control for state-owned enterprises and in the health sector in line with the Country-Specific Recommendations by the Council.

Portuguese banks have made considerable progress in strengthening their balance sheets, but remaining vulnerabilities in the banking sector need to be addressed. Supported by the favourable macroeconomic and financing environment, banks have reduced non-performing loans (NPLs), increased capital levels and improved their profitability, thus reducing near-term financial sector risks. Nevertheless, NPLs remain at high levels, in turn, weighing on banks’ profitability, funding and capital costs. High NPLs also hinder a more efficient allocation of resources in the corporate sector and thus weaken potential growth. Decisive efforts are therefore needed to reduce NPLs further. Progress in improving banks’ profitability would help to strengthen capital buffers and reduce the vulnerability of the sector to external shocks or a weakening in macroeconomic conditions. The Banco de Portugal has announced macro-prudential measures, which are welcome against the backdrop of the ongoing expansion in the real estate sector, the strengthening in household lending and remaining fragilities in household balance sheets. These developments will require close monitoring.

Addressing impediments to investment, increasing productivity and further improving the business environment remain key for strengthening potential growth. In this context, the authorities’ efforts to upgrade skill levels of the population and reduce administrative burden are highly welcome. The continuous positive labour market developments also seem to be supported by structural policies started during the macroeconomic adjustment programme. This notwithstanding, it remains essential for policies to continue supporting the adaptability of the labour market. In this respect, the wide use of temporary labour contracts might primarily be better addressed by making open-ended contracts more flexible rather than by introducing new restrictions for temporary contracts. As regards the minimum wage, a continued monitoring and analysis of its impact on the overall wage structure and on employment opportunities for less skilled workers seem important. Moreover, despite significant improvements over the last several years, further increasing the efficiency of the judiciary would positively impact the business environment.

The mission would like to thank the Portuguese authorities for the fruitful and open discussions.

The next PPS mission is planned to take place in the autumn of 2018.

(European Central Bank)

The rise of Chinese plug-in vehicle market is unstoppable

The demand for electric vehicles in China has gained more momentum as the country aims to sharpen its edge by taking fossil fuel powered vehicles off the road.

Sales have increased as more cities joined the electric vehicles era to find a solution to traffic jams and reduce carbon emissions. 

Last year, the total of plug-in electric vehicles (PEV) sales in China were 2.8 times above that of the Unite States.

According to the US Department of Energy (DOE), China sold about 555,300 vehicles compared to just below 200,000 in the US.

Chinese electric vehicle brands like Weltmeister and Byton have expertise and insight into the industry, previously holding top positions within established car companies Fiat and BMW.

Weltmeister aims to make its cars affordable to Chinese consumers, while Byton targets the high-end market by taking electric vehicles of BMW, Benz and Tesla as their rivals.

According to China news, it is not an easy job to set a brand and make it stand out.

Investors have offered financial support for these ventures and are patiently awaiting more turnovers. 

Source: ecns.cn

SARB honours Mandela centenary by launching limited banknote

The South African Reserve Bank (SARB) will be launching its first commemorative banknote series, in celebration of the first democratically elected president Nelson Mandela’s birth centenary.

The bank issued a statement stating that these notes will cover all denominations namely R10, R20, R50, R100 and R200.

“As part of the celebrations, the South African Mint, a subsidiary of the SARB, will also be issuing a new commemorative circulation R5 coin. As part of the preparations for the launch, test packs of the commemorative banknotes were made available to members of the broader cash industry to allow them to make adequate preparations in relation to issues such as adaptions of cash processing and cash dispensing machines, ticketing machines and so forth.” The statement reads.

All the notes are scheduled to be launched by 18 July 2018.

The bank added that these commemorative banknotes and R5 coin will co-circulate for a limited time, together with the current Mandela banknote series and the existing R5 coin, and both sets will remain legal tender.

New study revealed substantial economic cost of crime to Brazil

Brazil’s Special Secretariat for the Strategic Affairs have revealed the economic cost of crime to Brazil. It is estimated to be about R$285 billion, or over 4% of the country’s Gross Domestic Product (GDP).

The study pointed out that the economic impact of crime has risen from R$113 billion in 1996, to R$285 billion in 2015, this amount is set to an average increase of about 4.5 % per year.

The increase in crime shows that policy initiatives meant to reduce crime cannot be based solely on expanding resources. The report recommends a thorough examination of existing policies to discontinue those with diminishing returns.

The report also stated that despite a significant increase in public security spending over the last 20 years, “the social return of such increases has been limited” as homicide rates have climbed from 35,000 to 54,000 over that period.

Today, most federal agencies have limited financial resources which reinforce the idea that public policy crime-reducing initiatives cannot be based on simply expanding public spending.

The special secretary at the Palácio do Planalto, Hussein Kalout said that the country needs to make public policies more efficient with fewer resources and innovation.

“It is no longer possible to make security policy by increasing economic spending for the State whose social return will continue to be small while crime continues to increase.”

Source: riotimesonline.com

Chinese Technology Giant ZTE suffers shares fall

Chinese Technology giant ZTE, was found by the US Commerce Department in April to have violated trade bans with North Korea and Iran. Following the findings, the company was banned and prevented from buying any parts from the United States suppliers.

This ban forced ZTE to suspend major operations which led to trading in its shares to be halted in April. Last week, the US reached a deal with the Chinese company that would remove the ban. Some of the conditions to the deal is for the company to pay $1 billion penalty, hire a US-approved compliance team and to replace its management board.

ZTE, is China’s second biggest telecoms maker based in Shenzhen. The company depends on US-made components for the production of handsets. The firm’s share were down by 10% in the early trade in Shenzhen, which is the maximum allowed on the mainland.

However, the US Senate leaders are expected to vote later this week on an amendment to a bill that could block the agreement between the Trump administration and ZTE.

 

(Source: BBC News)