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Tag: South Africa

  • South Africa raises VAT for first time in 25 years

    South Africa’s new leadership has announced it was taking the politically risky step of raising value-added tax (VAT) for the first time in 25 years to cut the deficit and stabilise debt under new President Cyril Ramaphosa.

    The government of Africa’s most industrialised country has to plug a revenue hole in its budget and repair its economy after nine years of mismanagement under the scandal-plagued Jacob Zuma.

    The move to raise VAT to 15 per cent from 14 starting in April is expected to generate more 23 billion rand ($2 billion) of revenue in 2018/19.

    But with the VAT rate unchanged since 1993 the move was likely to prove unpopular ahead of a national election next year.

    “This is a tough, but hopeful budget,” Finance Minister Malusi Gigaba said, acknowledging the reality in his budget speech to parliament on Wednesday.

    “We decided that increasing VAT was unavoidable if we are to maintain the integrity of our public finances.”

    As Gigaba read his budget speech, the rand extended gains to 0.81 per cent against the dollar, government bonds firmed and retail shares on the stock exchange fell.

    Whatever cabinet Ramaphosa finally settles on will face an uphill battle to revitalise growth and create jobs in a nation still polarised by race and inequality more than two decades after the end of white-minority rule in 1994.

    Much of the blame for the state of the economy has been laid at the door of Zuma and his allies.

    He was forced to step down as president this month by the ruling African National Congress (ANC), following a series of scandals. He has denied all wrongdoing.

    But treasury officials sought to project a relatively optimistic outlook as they assessed economic prospects for the immediate future.

    Gigaba said poor households would be cushioned against the VAT rate rise through a zero-rating of basic food items such as maize meal and beans, and welfare payments increases.

     

  • Henry Okah loses bid to overturn South Africa conviction

    Henry Okah loses bid to overturn South Africa conviction

    South Africa’ s Constitutional Court on Friday set aside the judgment of the Supreme Court of Appeal which had reduced  the 24 year jail term for Nigeria’s Henry Okah, leader of the Movement for the Emancipation of the Niger Delta (MEND).

    Okah had last November, challenged his conviction in South Africa for the March 2010 car bombs in Warri, Delta State, and the 2010  Independence Day explosion in Abuja in which 12 people were killed and 36 injured.

    He was resident in South Africa at the time of the explosions.

    A  Johannesburg High Court convicted him in 2013 for the two bombings under the Protection of Constitutional Democracy Against Terrorist and Related Activities Act.

    It based its decision on the fact that he was a leader of MEND The High Court found he was a leader of the Movement for the Emancipation of the Niger Delta (MEND)‚ an umbrella organisation of militant resistance groups in the south-eastern states of Nigeria.

    Okah however approach the Supreme Court of Appeal (SCA) which  declared that although   the applicant  orchestrated the Abuja bombings from within South Africa, the country had no  jurisdiction to try him  for the crimes the  bombings took place  outside the borders of South Africa.

    It said the Act under which Okah was tried confers extra-territorial jurisdiction only in relation to crimes of financing terrorism.

    His conviction was thus reduced to 20 years in prison.

    The SCA’s ruling did not go down well with the state which headed to the Constitutional Court.

    In a unanimous judgment on Friday‚ the Constitutional Court said  South Africa has extra-territorial jurisdiction to try terrorist offences occurring  outside the country.

    Okah was convicted and sentenced to 24 years in 2013 on 13 counts of terrorism, including engaging in terrorist activities, conspiracy to engage in terrorist activities, and delivering, placing, and detonating an explosive device in 2010.

  • South Africa to raise VAT for first time in 25 years

    South Africa to raise VAT for first time in 25 years

    South Africa will increase value added tax ( VAT ) for the first time in over two decades, the Treasury said on Wednesday.

    The Finance Minister, Malusi Gigaba, said while presenting the budget plan before parliament that VAT would increase to 15 per cent from 14 per cent effective April 1.

    VAT had remained unchanged since 1993.

    “This is a tough, but hopeful budget,” Gigaba said.

    “We decided that increasing VAT was unavoidable if we are to maintain the integrity of our public finances.”

    A VAT hike ran the risk of adding a heavy financial burden on the poor, but Gigaba said poor households would be cushioned through a zero-rating of basic food items such as maize meal and beans.

    The Treasury said the budget deficit was seen narrowing to 3.5 per cent of gross domestic product ( GDP ) by 2020 from 4.3 per cent in the 2017/18 fiscal year.

    Expert said the increase was President Cyril Ramaphosa’s government aim to cut the budget deficit and stabilise debt after years of slow economic growth.

    Ramaphosa took over as leader of South Africa last week after Jacob Zuma stepped down on orders of the ruling African National Congress, bringing to an end nine years of corruption scandals and economic mismanagement.

    Zuma has denied all wrongdoing.

    The rand extended gains to 0.81 per cent against the dollar, government bonds firmed, while retail shares on the stock exchange due to the new three years budget outlay.

    Reuters/NAN

  • Ramaphosa says it’s time to review cabinet make up

    Ramaphosa says it’s time to review cabinet make up

    President Cyril Ramaphosa of South Africa said on Tuesday it was time to consider the make-up of his cabinet, amid growing speculation about whether Finance Minister Gigaba would keep his job.

    Ramaphosa was sworn in as head of state on Thursday after his scandal-plagued predecessor, Jacob Zuma, reluctantly resigned on orders of the ruling African National Congress ( ANC ) after nine years in office blighted by corruption, economic mismanagement and disputed appointments.

    In his first state of nation address on Friday, Ramaphosa strongly hinted at a cabinet shake-up when he said he would review the make-up and size of government departments.

    Investors are watching closely to see if Gigaba, who is due to deliver the budget speech on Wednesday, keeps his job.

    “This is the time to walk, to reflect even about cabinet and all that,” he told reporters on television news channel eNCA during his walk, in response to a question on whether there was still time to shake up his cabinet ahead of the budget speech.

    “I’ll be walking maybe three times a week, walking with our people,” he said. “I want my tummy to fall, so I‘m going to continue walking.”

    At a separate event in Cape Town, Gigaba declined to comment when asked by reporters about the speculation over his job.

    However, his deputy Sfiso Buthelezi, who sat next to his boss, said Gigaba would deliver the budget on Wednesday.

    “The question that is being asked of the minister, if he is going to present the budget. That is why we are here.

    “There is a budget that is going to be presented tomorrow and it is going to be presented by nobody else but Malusi Gigaba,” Buthelezi said.

    On Friday, Ramaphosa delivered a message of optimism and renewal Friday in his first state of the nation address, saying it’s time for South Africans to put discord behind them and that the country will “turn the tide” on corruption in state institutions this year.

    Ramaphosa’s address capped a dramatic week in which he was elected by ruling party lawmakers following the resignation of predecessor Jacob Zuma, whose tenure was marked by corruption scandals.

    Zuma was supposed to give the speech on Thursday, but it was postponed because of the leadership crisis that fueled uncertainty and anxiety in the country of 57 million people.

    “We should put behind us the era of diminishing trust in public institutions and weakened confidence in our country’s public leaders,” said Ramaphosa, who was Zuma’s deputy before becoming South Africa’s fifth president since the end of white minority rule in 1994.

    “A new dawn is upon us,” he said in a speech in parliament that drew applause but was criticized by the opposition as short on meaningful solutions.

    Ramaphosa, 65, faces the hard task of rooting out corruption that flourished in both state enterprises and the private sector under Zuma, implicating figures in the ruling African National Congress party that he now leads.
    In addition, he must tackle sluggish economic growth, high unemployment and economic inequality that are among South Africa’s most deep-rooted problems.

    The new president said his administration would concentrate on creating jobs and attracting investment, while also possibly downsizing bloated government departments and restructuring state-owned enterprises that are inefficient and prone to corruption.

    “This is the year in which we will turn the tide on corruption in our public institutions.

    “The criminal justice institutions have been taking initiatives that will enable us to deal effectively with corruption,” Ramaphosa said.

    South African authorities want to arrest a key member of the Gupta business family accused of using its links to Zuma to influence Cabinet ministers and secure state contracts.

    The suspect, Ajay Gupta, is considered a fugitive after failing to turn himself in, according to police.

    Eight people, including a member of the Gupta family, have already been arrested as part of an investigation into alleged corruption involving the Guptas, who deny any wrongdoing.

    The family is a flashpoint for national anger over “state capture,” the term used by South Africans to describe an allegedly wide-ranging effort to loot state enterprises under Zuma.

    Ramaphosa said he supports the work of a judicial commission that is about to investigate the phenomenon, but one opposition leader said the new president would have to turn on his own political party if he is serious about fighting graft.

    Reuters/NAN

  • Xenophobia: Nigerian stabbed in South Africa

    Xenophobia: Nigerian stabbed in South Africa

    The Nigerian Community in South Africa said yesterday  that a member was stabbed during a xenophobic attack in Rustenberg, North-West Province area.

    The President of Nigerian Union, South Africa, Mr Adetola Olubajo, told the News Agency of Nigeria (NAN) on telephone that the victim, identified as Desmond, was attacked on February 14.

    “Desmond is a Nigerian hair piece hawker in Rustenberg, North West Province of South Africa.

    “He was attacked on Feb. 14 and sustained multiple injuries. He was rescued when he was about to be set ablaze after being wet with petrol,’’ Olubajo said.

    He said that the Nigerian community in Rustenburg was currently living in fear as tension has heightened in the area.

    Olubajo said that the union`s executive had visited the city on a fact finding tour and had already spoken to Nigerians in the area.

    “Nigerians and their families told us that the situation is very dangerous and that their lives are not safe.

    “They also alleged that some group of people were abducting Nigerians and requesting money to bail themselves.

    “A Nigerian who couldn’t pay was murdered last month. This same group also looted businesses of foreign nationals, Nigerians in particular,’’ the president said.

    Olubajo said the union could not continue to keep quiet on this criminality and xenophobic act meted to Nigerians in South Africa.

    He said that there was need for the mission and government to intervene in the matter to avoid further loss of lives and properties of Nigerians.

    “There is need for the Nigerian government to engage with its counterpart in South Africa. It’s not correct that those who were attacked and killed are criminals.

    “Such statements are misinformation and misleading,’’ he said.

  • Xenophobia: Nigerian stabbed in South Africa

    Xenophobia: Nigerian stabbed in South Africa

    The Nigerian Community in South Africa said on Friday that a member was stabbed during a xenophobic attack in Rustenberg, North-West Province area.

    The President of Nigerian Union, South Africa, Mr Adetola Olubajo, told our reporter on telephone that the victim, identified as Desmond, was attacked on Feb. 14.

    “Desmond is a Nigerian hair piece hawker in Rustenberg, North West Province of South Africa.

    “He was attacked on Feb. 14 and sustained multiple injuries. He was rescued when he was about to be set ablaze after being wet with petrol,’’ Olubajo said.

    He said that the Nigerian community in Rustenburg was currently living in fear as tension has heightened in the area.

    Olubajo said that the union’s executive had visited the city on a fact finding tour and had already spoken to Nigerians in the area.

    “Nigerians and their families told us that the situation is very dangerous and that their lives are not safe.

    “They also alleged that some group of people were abducting Nigerians and requesting money to bail themselves.

    “A Nigerian who couldn’t pay was murdered last month. This same group also looted businesses of foreign nationals, Nigerians in particular,’’ the president said.

    Olubajo said the union could not continue to keep quiet on this criminality and xenophobic act meted to Nigerians in South Africa.

    He said that there was need for the mission and government to intervene in the matter to avoid further loss of lives and properties of Nigerians.

    “There is need for the Nigerian government to engage with its counterpart in South Africa. It’s not correct that those who were attacked and killed are criminals.

    “Such statements are misinformation and misleading,’’ he said.

    NAN

  • South African stocks in demand after Zuma quits, rand soars

    South African stocks in demand after Zuma quits, rand soars

    South African stocks index rose as much as five per cent on Thursday, putting the main index on track for its biggest one-day gain in more than three years.

    The currency remained on the front foot, soaring to its firmest since early 2015, in the wake of Zuma’s exit.

    Analysts have, however, warned the rally faces serious obstacles ahead of a budget speech next Wednesday.

    Zuma quit late on Wednesday, reluctantly heeding orders by the ruling African National Congress ( ANC ) to bring an end to a nine-year tenure punctuated by scandals, stagnant economic growth and policy uncertainty.

    As at 1530 GMT, the blue chip Top-40 index surged four per cent to 52,665 points, pulling back from a high of 53,072 achieved earlier but still on course for its biggest one-day gain since Sept. 2015.

    The broader All-share index was up by 3.72 per cent at 59,533 points.

    “The big news is that Zuma has now resigned and that has created a lot of euphoria.

    “South African incorporated, banks, retailers and the like are all looking sharply better as a result,” said Independent Securities’ trader Ryan Woods.

    South African banks considered the barometer of both economic and political sentiment were a feature on the gainers’ list.

    The banking index surged 5.8 per cent with Nedbank rising 5.37 per cent and rival FirstRand up 6.4 per cent.

    Banks have largely borne the brunt of Zuma’s policy decisions that included the sacking of two respected finance ministers, Nhlanhla Nene and Pravin Gordhan.

    That, along with a weak economy, contributed to sovereign credit ratings downgrades to junk by S&P Global Ratings and Fitch.

    In reaction to Zuma’s resignation, ratings agency Moody’s said it was focused on the new leadership’s response to economic challenges. S&P Global Ratings said the leadership change would not immediately affect the credit status.

    Cyril Ramaphosa, former chairman of African biggest telecoms operator MTN Group, was sworn in as president on Thursday.

    Ramaphosa, who has vowed to fight corruption and revitalise the economy, is seen by business leaders and investors as well placed to turn around the economy.

    South Africa’s Gross Domestic Product (GDP) is estimated to grow by less than one percent this year.

    Another key issue facing the 65-year-old president is policy uncertainty in South Africa’s mining industry, an important economic engine, which has been fighting in court with Zuma’s mines minister, Mosebenzi Zwane, over an increase in black ownership targets.

    But some analysts said that the former union leader’s to-do list is way too long to make an immediate impact.

    In the foreign exchange market, the rand advanced to levels last seen in February 2015.

    “The good gains the rand has made could be extended toward 11.55/dollar, and move toward 11.00/dollar baring any further credit rating downgrades for S.A. and a credit positive budget,” said Investec’s Chief Analyst Annabel Bishop in a note.

    At 1515 GMT, the rand was at 11.6600 against the dollar, having reached a session-best of 11.6025 earlier per cent stronger than its New York overnight close and at levels last seen in Feb.  2015.

    “The economy is coming off an extremely low base so there is good chance the optimism will be around for some time, but Ramaphosa has to very soon move from the honeymoon phase to the doing phase,” said Chief Executive of Canon Assets Management Adrian Saville.

    Reuters/NAN

  • Breaking: Ramaphosa emerges South Africa President

    Breaking: Ramaphosa emerges South Africa President

    Cyril Ramaphosa has emerged as President of South Africa, following elections by lawmakers on Thursday.

    This is following the resignation of Jacob Zuma from office of Wednesday.

    According to Chief Justice Mogoeng Mogoeng,  Ramaphosa was elected without a vote after being the only candidate nominated in the parliament in Cape Town.

     

    Details Later

     

  • Zuma refuses to resign, says he is being victimised

    Zuma refuses to resign, says he is being victimised

    Jacob Zuma has refused to heed calls to step down as South African president, denouncing moves by the ruling African Nation Congress ( ANC ) party to remove him following a string of damaging corruption scandals.

    The ANC formally asked him to resign on Tuesday.

    “I am being victimised here. I think there has been a misinterpretation,” Zuma said in an attempt to present his side of the story.

    Zuma however indicated he would accept the outcome of a parliamentary vote of no confidence against him, which has been scheduled for Thursday.

    During more than a week of negotiations with the ANC’s key decision-making body, Zuma said that “nobody provided the reasons, nobody has been able to provide me with what I have done.”

    Zuma denied any wrongdoing over the corruption allegations of recent years. “There is no problem. There has never been a problem,” he said in the televised remarks.

    The ANC “will regret the crisis they have caused,” he said, adding he wsa planning to make a formal statement on the calls for his resignation later on Wednesday.

    During the negotiations with the ANC leadership, Zuma said he had in principle agreed to step down but presented “a package” of demands that included him staying in power for several more months.

    The ANC didn’t accept those conditions, said Zuma.

    “I am open to further discussion, but they are rushing [into a vote of no confidence],” he said, adding that he was unjustly “portrayed as this person who is defying the leadership.”

    If Zuma loses the vote, parliament may elect a successor the same day, according to ANC treasurer general Paul Mashatile.

    “We will possibly elect a new president on Thursday … if not Friday,” said Mashatile, assuming scandal-hit Zuma will lose the vote.

    Zuma’s successor would most likely be Deputy President Cyril Ramaphosa, who in December took over from Zuma as president of the ANC.

    Zuma, who became president in 2009 and whose second term officially ends in 2019, has already faced six no-confidence motions, four of which were voted on.

    This time, the vote is likely to succeed because the ANC holds a large majority of seats in parliament, and the vote of no confidence is decided by a simple majority.

    If Zuma loses the vote, South Africa’s chief justice will preside over the election of a new president, while the cabinet will have to resign.

    The ANC caucus in parliament decided to hasten the vote, which had been initially requested by opposition party Economic Freedom Fighters for February 22.

    “We want certainty.

    “We would like the incoming president [to hold the postponed State of the Nation address] without delay,” he said.

    Earlier on Wednesday, police arrested three people from the Johannesburg home of the Gupta family, linked to the corruption scandals that have engulfed Zuma.

    Hangwani Mulaudzi, the spokesman of the elite crime investigation unit the Hawks, confirmed the arrests to dpa, without disclosing the identity of those arrested.

    Arrest warrants had been issued for two other people who were expected to hand themselves over to the police, Mulaudzi said.

    Media reports said those arrested are expected to appear before a commercial crimes court in the city of Bloemfontein later on Wednesday.

    The influential Gupta family, which has business interests in the computer equipment, mining, air travel, energy, technology and media industries, have been accused of influencing the state together with Zuma through lucrative business deals and possibly even influencing ministerial appointments.

    Most recently, the family came under fire when one of their companies took over the management of a small-scale dairy farm, which shortly thereafter received a payment of 34 million rands (2.85 million dollars) from the provincial agriculture department.

    A high court in January ordered the freezing of all assets linked to the farm.

    Zuma and the three Gupta brothers he is mainly linked to – Ajay, Atul and Rajesh – deny any wrongdoing.

    Opposition party Democratic Alliance ( DA ) meanwhile demanded that the police extend their raid on the Gupta family to include government ministers linked to the corruption allegations.

    “The investigations and action simply cannot end [with the Guptas] and must continue to all those implicated, including key ministers,” DA member Zakhele Mbehle said in a statement.

    Mbehle demanded investigations into four ministers as well as ANC secretary general Ace Magushule.

    NAN

  • Zuma to face no-confidence vote on Thursday – ANC

    Zuma to face no-confidence vote on Thursday – ANC

    South Africa’s parliament will hold a vote of no confidence in President Jacob Zuma on Thursday, the governing ANC party said on Wednesday.

    “We will possibly elect a new president on Thursday … if not Friday,” ANC treasurer general Paul Mashatile told journalists, assuming scandal-hit Zuma will lose the vote.

    “We want certainty.

    “We would like the incoming president [to hold the postponed State of the Nation address] without delay.”

    The vote of no confidence, requested by opposition party Economic Freedom Fighters, had initially been scheduled for Feb. 22.

    The ANC caucus in parliament decided to move the vote forward after it formally asked Zuma to resign on Tuesday.

    Finance Minister Malusi Gigaba said that Zuma would speak at 0800 GMT and satellite trucks were in position at Pretoria’s Union Buildings, the seat of the country’s government.

    Zuma’s office said there was no “official communication” of any impending address but urged media to wait.

    The Secretary-General of South Africa’s ANC said Zuma did not threaten to challenge his removal by the party in court, as speculated by local media.

    Ace Magashule, the sribe of the ANC, had told a news conference that Zuma would respond by Wednesday on the decision to “recall” him.

    “President Jacob Zuma has behaved like a leader of the ANC.

    “He has never threatened us with any court action, not at all.

    “He did in fact confirm that he would respond by tomorrow.”

    Read Also:  ANC asks Zuma to resign

    The ANC ordered Zuma to step down as head of state after marathon talks over the fate of a leader whose scandal-plagued years in power darkened and divided Nelson Mandela’s post-apartheid ‘Rainbow Nation’.

    Leading members of the ANC want new party leader Cyril Ramaphosa to replace Zuma as president, Magashule told a news conference.

    The party’s national executive was split on precisely when Zuma should go, Magashule added, leaving the president’s immediate fate still hanging in the balance.

    Zuma has been living on borrowed time since Ramaphosa, a union leader once tipped as Mandela’s pick to take over the reins, was elected as head of the 106-year-old ANC in December, narrowly defeating Zuma’s ex-wife, Nkosazana Dlamini-Zuma.

    In spite of the damning decision to order Zuma’s “recall” ANC-speak for ‘remove from office’ domestic media have speculated that the 75-year-old might yet defy the party’s wishes, forcing it into the indignity of having to unseat him in parliament.

    Shortly before midnight, the SABC state broadcaster said Zuma had been told in person by Ramaphosa that he had 48 hours to resign.

    A senior party source later told Reuters Zuma had made clear that he was going nowhere.

    “Ramaphosa went to speak with him,” the source said, adding that when Ramaphosa returned to the ANC meeting in a Pretoria hotel, the discussions were tense and difficult”.

    “We decided to recall Zuma. He hasn’t been told yet,” the source said.

    On Friday his wife Tobeka Madiba-Zuma posted comments on Instagram suggesting Zuma, who has challenged and defied attempts by the ANC and courts to rein him in, was prepared to fight and believed he was the victim of a Western conspiracy.

    “He will finish what he started because he does not take orders beyond the Atlantic Ocean,” she said.

    South Africa’s economy, the most sophisticated on the continent, has stagnated under Zuma’s nine-year tenure, with banks and mining firms reluctant to invest because of policy uncertainty and rampant corruption

    So far there has been silence from Zuma in response to Tuesday’s ANC order, suggesting a power struggle behind the scenes with new party leader Cyril Ramaphosa.

    Besides his controversial relationship with the influential Guptas family,  Zuma has 783 counts of corruption outstanding against him relating to a multi-billion dollar state arms deal in the late 1990s.

    Zuma’s spokesman could not be reached for comment on Wednesday.

    ANC spokesman Pule Mabe told state broadcaster SABC that Zuma remained “a disciplined member of the ANC and would do what is best for a cadre of the movement”.

    Besides the pressure from the ANC, Zuma is facing a no-confidence motion in parliament brought by the opposition Economic Freedom Fighters and set for Feb. 22.

    The ANC could throw its weight behind such a vote if Zuma, who has survived several no-confidence motions in the past, refused to resign.