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Morning Market Scoop 6 November 2018

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Barry Dumas
Moring-market-scoop

Morning Market Scoop 6 November 2018

In our morning market scoop:

  • South African Airways clean-up. Gordhan tells SAA staff to ‘clean out the dirt’
  • Department of Energy (DOE) has finally released the much-anticipated fuel price changes yesterday and its keeping the price of unleaded petrol unchanged. Sadly an increase in diesel.

Gordhan SAA

“CLEAN OUT THE DIRT” - PRAVIN GORDHAN

What’s the scoop? Cleaning up corruption at SAA

Earlier in the week Public Enterprises Ministry made a statement that "bad decisions were made by previous boards and management, including allowing corruption to incapacitate the airline".

  • The new minister of Public Enterprises, Pravin Gordhan is making a bold statement as he called for corrupt individuals who stole from SAA to pay back the money.

The big picture SAA a once celebrated airline has been a topic of much discussion over the last couple of years as the airline has not been able to generate a profit since 2011.  It has largely been able to keep afloat thanks to State guarantees which has put strain on the state coffers. The main priority now is to stabilise SAA through cost reduction and to turn the airline into a financially and operationally sustainable business.

What does all this mean for me?

  • One thing can be for certain in that corruption is starting to be weeded out of state owned enterprises, which is long overdue. The question that remains is unfortunately how much is this exercise going to cost the TAX payer at the end of the day?

Local Petrol

“NO RELIEF IN SIGHT”

What’s the scoop? No relief in the fuel price?

The Department of Energy (DOE) has finally released the much-anticipated fuel price changes yesterday and its keeping the price of petrol unchanged.

  • The DOE have however increased the prices of Diesel (o.05% sulphur) by 47.92c/l and Diesel (0.005% sulphur) by 50.92c/l. Paraffin (wholesale) will increase 28c/l while the retail price for will increase by 61c/l.

The big picture To make matters worse, government has also implemented a slate levy on diesel and petrol of 21.92c/l as of the 7th of November to improve the slate account balance which is below its current threshold. Jeff Radebe, the minister of energy informed parliament that the research into the possibility of capping the price of petrol may be finalised by January 2019.

What does all this mean for me?

  • Consumers will remain under pressure for the foreseeable future as the cost of goods and services will continue to tick higher and higher.

 

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