JSE’s an­nual US trip ‘more som­bre’

CityPress - - Business & Tenders - DE­WALD VAN RENSBURG de­wald.vrens­burg@city­press.co.za

The JSE’s an­nual road­show to New York was “a lot more som­bre” this year com­pared with pre­vi­ous ones, the ex­change’s CEO, Nicky New­ton-King, has said.

Fi­nance Min­is­ter Malusi Gi­gaba an­swered all the hard ques­tions in an up­front way and SA Re­serve Bank gover­nor Le­setja Kganyago was very clear about the bank’s in­de­pen­dence be­ing non­nego­tiable, she told City Press.

“All of Amer­ica’s top money is here. They are mostly long­time in­vestors in the coun­try, the proper money.

“This is not about new in­vestors, it is an op­por­tu­nity to talk to those who are already in­vested. Peo­ple with se­ri­ous money in the coun­try de­serve an­swers,” she said by phone from New York.

“South Africans are more down on the coun­try than in­vestors are. I think in­vestors are tak­ing a wary look. I think that is the right word.”

The out­come of the ANC’s elec­tive con­fer­ence next month seemed to be loom­ing large on in­vestors’ minds.

“They are ask­ing about lead­er­ship. We need the new lead­er­ship to make growth a pri­or­ity. What in­vestors are in­vest­ing in is a mar­ket­place they can trust, where they can buy and sell. They are less in­ter­ested in the per­for­mance of the JSE All Share In­dex and more in­ter­ested in the lead­er­ship team.

“We have to be very hon­est about the state of South Africa. It is a long-term play. Busi­ness is in good hands, the rule of law is strong. There are strong coun­ter­vail­ing things like an in­de­pen­dent me­dia.

“The up­side is very sig­nif­i­cant. We are say­ing do not be overly con­cerned with the short-term noise.

“These guys know,” said King, re­fer­ring to com­ments by An­heuser-Busch InBev CEO Car­los Brito at the con­fer­ence to the ef­fect that South Africa’s prob­lems were noth­ing com­pared with those many oth­ers were deal­ing with.

A lot of the money rep­re­sented at the event is prob­a­bly in­vested in gov­ern­ment bonds, which are expected to fall to “real junk” sta­tus af­ter rat­ings agency Moody’s sched­uled re­view on Novem­ber 25.

In his speech at the event, Kganyago said es­ti­mates put the out­flow of money from the local bond mar­ket af­ter this likely down­grade at be­tween R100 bil­lion and R180 bil­lion, de­pend­ing on how much was already priced into the mar­ket.

For­eign­ers are still pro­gres­sively tak­ing over the local bond mar­ket. Foreign own­er­ship of gov­ern­ment debt reached a record of 41.7% in Oc­to­ber.

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