Don't believe all the doom and gloom, says Ninety One
A common perception among investors that SA is in trouble is wrong, says Ninety One, the company spun out of Investec.
Malcolm Charles and Morkel Kincaid, addressing an audience of NFB clients in East London recently, said the facts showed a positive picture, and attributed prevailing negative sentiment to a drawn-out bearish stretch, with the market in its worst position since 1998.
Charles dismissed a common refrain that President Cyril Ramaphosa had “done nothing” to turn the tide since a looting spree under his predecessor, Jacob Zuma.
The Reserve Bank was keeping inflation under control, the rand has held its own against a number of currencies and Eskom was likely to emerge from its long crisis.
Kincaid said although 2022 has been a brutal year for most asset classes, “there are some great opportunities in the local
bond market and our equity market is reasonably priced”.
Charles said Ramaphosa’s priorities had been rebuilding the functions of the state and the infrastructure spend. SARS was on the road to recovery, and had, over the past 18 months, collected R109bn from delinquent defaulters.
NPA head Shamila Batohi has arrested some key people and has court dates for more.
What Ramaphosa has done well, he said, is appoint qualified professionals in non-political positions, reducing ruinous ANC cadre deployment.
“Even the latest Eskom board has two accountants and three engineers. People who can fix the problems.”
He said the Zondo commission had exposed how much trouble SA was in with looting and state capture.
“But just think how much information the commission put before the courts. R16.9bn has been seized by the asset forfeiture unit. Over R2bn has returned to the departments it was stolen from.”
“People complain that the commission cost R1bn, yet SARS has collected R4bn, much of it through testimony from the commission.”