Business and unions post high inflation forecasts

committee said yesterday it expected inflation next year to be 5.2 percent. For 2014 its forecast – at 5 percent – is below analyst estimates. A separate survey conducted by Reuters, and quoted yesterday by Reserve Bank governor Gill Marcus, showed market analysts expect inflation to average 5.3 percent in 2013 and 5.4 percent in 2014.

Inflation is the outcome of a variety of events, including movements in food and oil prices as well as the rand exchange rate. Combining the prognosis of these volatile variables could be described as a work of art rather than a science.

Unionism

Zwelinzima Vavi, the general secretary of Cosatu, told its national congress on Tuesday that the union’s membership had grown by 25 percent in nine years.

The figure is lower than the membership targets that were set in 2003 by Cosatu in its 2015 plan. It set a target for increasing membership by 10 percent every year, working towards 4 million in 2009.

By 2009, Cosatu had a membership of 1.97 million, a far cry from the target. Things could be worse, however.

Reuters reports that membership of unions in Europe has been shrinking drastically in the past 30 years as factories close and economies become increasingly service-orientated.

It says this has contributed to a slow decline for organised labour in many

Trade union officials had the most pessimistic view, putting inflation next year above the 6% ceiling at 6.4% and as high as 6.9% the following year.

countries, most recently in the failure to organise a credible resistance to lay-offs in the 2009 and 2010 economic crisis.

The report says in France, union membership has fallen from almost 20 percent in 1980 to just under 8 percent in 2008. In Germany, it has fallen from 35 percent to just under 20 percent in the same period, according to the Organisation for Economic Co-operation and Development.

It says: “Union membership in Denmark, Sweden and Finland remains high – around 70 percent – partly because unemployment and other social benefits are paid through unions.

“Free of stigma that can be associated with organised labour, members are also eligible for a range of services not available to non-members, from representation in job interviews to free cooking classes.”

Cosatu could take take a leaf out of this book. In South Africa, we could entrust Cosatu with administering the Unemployment Insurance Fund just to test if it is really committed to integrity and anticorruption as Vavi has been crusading. Or we could borrow from France, where from 1948 to 2008, unions were supported financially by the state and management.

Tourism

Although there are encouraging signs that South Africa’s tourism industry will continue to attract leisure travellers in the coming season, as it did last year, business tourism is one of the most lucrative forms – especially as many delegates to international conferences tend to return to the host country on holiday with their families.

So it is particularly good news that the Cape Town International Convention Centre (CTICC) expects to bring R145 million into the Western Cape economy by hosting the 17th International Conference on Aids next year. It is expected to bring more than 10 000 of the world’s leading scientists, policymakers, activists, government leaders and representatives of civil society to the city, many with their partners.

According to Rashid Toefy, the chief executive of the CTICC, the only other international medical conference to attract such numbers to this country was the 19th World Diabetes Conference held in Cape Town in 2006.

South Africa was one of four countries bidding to host the Aids conference. It is the second time the CTICC has secured it – the last was in 2000 and led to a turning point in the international drive to break down barriers to the treatment of Aids although, ironically, this country was one of the last in which the government supported measures that were successful in other parts of the world.

In addition to the economic benefits of hosting this event, the conference will also help to sustain approximately 667 direct jobs in the Western Cape and a further 333 indirect jobs as a result, according to Toefy.

Explaining that, since its opening, the CTICC had primarily targeted the international associations market, he said the sector was fairly recession-proof and had the largest economic impact on the region. Another large conference on the CTICC’s books is the International Geological Congress, that is also expected to bring more than 10 000 delegates to the city in 2016.

Competition for such conferences is, of course, fierce, and one of the most successful countries is Germany. Petra Hedorfer, the chief executive of the German National Tourist Board, announced earlier this year that it was the number one destination in Europe for conferences and trade fairs and brought 13.5 billion (R144.6bn) a year into the national economy.