PRUDENTIAL CAPITAL MARKET UPDATE AS AT 15 JAN. 2018

RAIS WA RWANDA PAUL KAGAME AWASILI NCHINI NA KUPOKELEWA NA MWENYEJI WAKE RAIS DKT. JOHN POMBE MAGUFULI JANUARI 14, 2018

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akisaliamiana na Rais wa Rwanda Paul Kagame mara baada ya kuwasili katika uwanja wa Ndege wa kimataifa wa Mwalimu Julius Nyerere (JNIA) jijini Dar es Salaam. Januari 14, 2018. 

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akiwa na Rais wa Rwanda Paul Kagame mara baada ya kumpokea katika uwanja wa Ndege wa kimataifa wa Mwalimu Julius Nyerere (JNIA) jijini Dar es Salaam. Januari 14, 2018. 

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akipita kwenye Gadi ya Jeshi ya heshma pamoja na mgeni wake Rais wa Rwanda Paul Kagame mara baada ya kumpokea katika uwanja wa Ndege wa kimataifa wa Mwalimu Julius Nyerere (JNIA) jijini Dar es Salaam. Januari 14, 2018. 

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akizungumza na mgeni wake Rais wa Rwanda Paul Kagame wakati wakielekea Ikulu kwa ajili ya mazungumzo. Januari 14, 2018. 

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akiangalia frame ya Picha ya Kiasili aliyokabidhiwa na mgeni wake Rais wa Rwanda Paul Kagame kabla ya kuanza kwa mazungumzo yao Ikulu jijini Dar es Salaam. Januari 14, 2018.

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akiongoza mazungumzo ya Kiserikali na Rais wa Rwanda Paul Kagame (Serikali ya Rwanda) Ikulu jijini Dar es Salaam. Januari 14, 2018. 

Rais wa Rwanda Paul Kagame akihotubia Watanzania kupitia vyombo vya habari mara baada ya kumaliza mazungumzo na Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli Ikulu jijini Dar es Salaam. Januari 14, 2018.

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akihotubia Watanzania kupitia vyombo vya habari mara baada ya kumaliza mazungumzo na mgeni wake Rais wa Rwanda Paul Kagame Ikulu jijini Dar es Salaam. Januari 14, 2018.

Rais wa Jamhuri ya Muungano wa Tanzania Dkt. John Pombe Magufuli akifurahi jambo na Rais wa Rwanda Paul Kagame pamoja na makamu wa Rais Mhe. Samia Suluhu Hassan wakati wa kumsindikiza Rais Paul Kagame wa Rwanda mara baada ya kumaliza mazungumzo Ikulu jijini Dar es Salaam. Januari 14, 2018.

BOFYA HAPA KWA PICHA ZAIDI

DAR, KIGALI AGREE ON SGR PROJECT

President John Magufuli elaborates a point to journalists after his in-door meeting with his Rwandan counterpart, Paul Kagame at State House in Dar es Salaam yesterday.

Tanzania and Rwanda have agreed to construct a Standard Gauge Railway (SGR) network connecting Isaka in Shinyanga to Kigali, with the key goal of linking the landlocked country to the port of Dar es Salaam.

President John Magufuli revelled the agreement in the city yesterday after his talks with the visiting Rwanda President Paul Kagame at the State House in Dar es Salaam.

President Kagame was in the country for a one-day state visit. The 400-kilometre track is meant to boost trade between Tanzania and Rwanda as part of the central railway network that runs from the port of Dar es Salaam.

“I do direct the ministers responsible for infrastructure from Tanzania and Rwanda to meet in two weeks’ time to deliberate on the costs of implementing the project,” Dr Magufuli remarked.

He further revealed that the design and feasibility study for the mega project had been finalised; stating that the railway network will haul cargo to Burundi and Democratic Republic of Congo (DRC).

Dr Magufuli assured his Rwandan counterpart that once all procedures are finalised, they will lay a foundation stone for the railway network from Isaka to Kigali in Rwanda.

RAIS PAUL KAGAME AKIONDOKA NCHINI TANZANIA MCHANA HUU, 14 JANUARI 2018

RAIS JOHN MAGUFULI AMKARIBISHA IKULU RAIS PAUL KAGAME WA RWANDA, 14 JANUARI 2018

RAIS WA RWANDA, PAUL KAGAME ALIVYOPOKELEWA NA RAIS JOHN MAGUFULI, 14 JANUARI 2018

TAZAMA RAIS KAGAME ALIVYOTUA TANZANIA, 14 JAN. 2018

Hivi ndivyo Rais wa Rwanda Paul Kagame alivyowasili katika uwanja wa ndege wa Mwl. Julius Nyerere Dar es Salaam tayari kwa ziara yake ya siku moja nchini Tanzania. Rais Kagame amepokelewa na mwenyeji wake Rais John Magufuli na kisha kuelekea Ikulu kwaajili ya mazungumzo.

UGANDA RECALLS ENVOY TO US FOR BEATING WIFE

Uganda's deputy ambassador to the US, Mr Dickson Ogwang. He was recalled over domestic violence.

Uganda has recalled its deputy ambassador to the United States after the US State Department kicked him out for beating his wife.

Dickson Ogwang was asked to leave Washington DC after he reportedly invoked diplomatic immunity to avoid prosecution.

Confirming the incident, Uganda's deputy minister for International Affairs, Mr Okello Oryem, said "it is unfortunate".

“One of our officers had a domestic incident at his house that resulted in him being asked to leave the country; It is unfortunate and we at the Ministry of Foreign Affairs recognise that,” he said.

“When he arrives, we shall counsel him together with his wife so that such a thing does not happen again,” Mr Oryem added.

STATEMENT FROM BHARTI AIRTEL

We have noted with concern the statement made by the Hon’ble Finance Minister on Jan 11, 2018. We would like to reiterate our statement of December 22, 2017. Further to ensure that there is a common and accurate recollection and understanding of facts surrounding the privatization of TTCL and related transactions, we are restating the sequence of events below which clearly demonstrate all of the transactions were completed with full transparency, integrity and fairness.

• In or around 2001, the Government of Tanzania initially launched two open tenders, one after the other, to seek investors to privatize TTCL. MSI Systems International Cellular Investments B.V. (MSI) was the successful bidder in the second round and eventually acquired a 35% stake in TTCL for a total consideration of ~ $65m.

• As a result, TTCL was owned 65% by the Government of Tanzania and 35% by MSI. Celtel Tanzania was subsequently established as a 100% owned subsidiary to launch the mobile operations using shareholder loans from TTCL which were later converted into equity.

• The Government of Tanzania and MSI in 2005 agreed to split the two companies and each (Government of Tanzania and MSI ) directly came to own 65% and 35% of TTCL and 65% and 35% of Celtel Tanzania. As each was already a shareholder, there was no valuation or consideration required. At the same time, MSI acquired an additional 25% stake in Celtel Tanzania and paid $28m to the Government of Tanzania.

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BALOZI DKT. ABDALLAH POSSI AKABIDHI HATI ZA UTAMBULISHO NCHINI AUSTRIA

Mheshimiwa Dkt. Abdallah Possi, Balozi wa Tanzania nchini Ujerumani ambaye pia anaiwakilisha nchi huko Austria akiwasili katika Ikulu ya Vienna tayari kwa kujitambulisha rasmi nchini humo kwa kukabidhi hati za utambulisho. 

Balozi wa Tanzania nchini Ujerumani na Austria Mheshimiwa Dkt. Abdallah Possi akiwasilisha Hati za Utambulisho kwa Rais wa Austria Mheshimiwa Dkt. Alexander Van der Bellen kwenye hafla fupi ya kujitambulisha iliyofanyika kwenye Ikulu ya Vienna, Austria.

Rais wa Jamhuri ya Austria Mhe. Dkt. Alexander Van der Bellen akizungumza na hatimaye kupiga picha ya pamoja na Mhe. Dkt. Abdallah Possi, Balozi wa Tanzania nchini Austria mwenye makazi yake nchini Ujerumani.

PwC HIT WITH 2-YEAR INDIA AUDIT BAN FOR SATYAM CASE

India’s securities regulator has banned the global accountancy firm PwC from auditing listed companies in the country for two years, after it failed to spot a $1.7bn fraud at the now defunct Satyam Computer Services. 

In a 108-page report, the Securities and Exchange Board of India said Price Waterhouse — PwC’s Indian audit unit — had neglected to check “glaring anomalies” in the financial details reported by Satyam, whose downfall followed one of the worst financial scandals in Indian corporate history. 

For about five years beginning in 2003, Sebi said, Satyam inflated its revenue by accounting for 7,561 fake invoices. The fraud persisted in part because Satyam’s auditor, PwC, “did not independently check the veracity of the monthly bank statements”. 

It relied upon assurances from Satyam “without any further examination or inquiry into the matter and ignored the balance confirmations received directly from banks which were showing true balances”, the report said. 

AIR TANZANIA SCOUTS FOR 88 NEW CABIN CREW

Air Tanzania Company Limited has announced vacant positions for at least eighty-eight (88) cabin crew ahead of fresh arrivals of four brand new planes from June, this year.

Anytime from now, the company will also be sending eight pilots abroad out of planned ten to learn how to operate the new machines, all in keeping with international regulations.

In a telephone interview with The Daily News yesterday, ATCL Managing Director and Chief Executive Officer Engineer Ladislaus Matindi said the public-owned airline had since recruited 30 cabin crew, and would soon advertise for 88 more posts to fill potential vacancies to be created beginning next June.

In June, 2015 President John Magufuli announced government plans to purchase two branded Bombardier CS300 aircraft with capacities of between 137 and 150 passengers, slated for delivery between May and June, this yearThe Head of State also revealed that the government would buy one 262-seater Boeing 787 Dash 8 Dream Liner whose delivery is also set for next June (2018), adding that initial payments for the aircrafts had since been made.

AVIATION SETS TO GROW OVER 10 PC IN NEAR FUTURE

The aviation sector is tipped to grow by over ten per cent in the coming years, thanks to good policy laid on the ground.

The aviation sector over the years has been growing by an average of 10 per cent but industry experts see a bright future and potential ahead.

National Aviation Services (NAS) Group CEO, Hassan El- Houry said the country’s geographical size and position plus policies warranting the sector growth. “The government has put in place a very good eco-system for aviation sector growth.

“Thus, the aviation sector will continue to contribute to the economy positively,” Mr El-Houry told the “Daily News” in an interview yesterday. He said Tanzania “is a rising star in aviation sector in Africa.” The CEO was in the country for business trip.

NAS handles several airlines include two major ones Air Tanzania and FlyDubai in almost all key airports in the country— at Julius Nyerere International Airport, Kilimanjaro International Airport, Mwanza and Mbeya Airports.

ETIHAD AVIATION GROUP APPOINTS NEW GROUP CHIEF FINANCIAL OFFICER

Mark Powers, Etihad Aviation Group's Chief Financial Officer.

Abu Dhabi, UAE – Etihad Aviation Group (EAG) today confirmed the appointment of Mark Powers as its new Group Chief Financial Officer. Mr Powers will join EAG in January 2018.

In his new role, Mr Powers will be responsible for the finance function across the Abu Dhabi-based group’s five divisions, which comprise UAE national airline Etihad Airways, Etihad Airways Engineering, Etihad Airport Services, Hala Group and Airline Equity Partners.

Mr Powers joins Etihad Aviation Group from Tulane University’s A.B. Freeman School of Business, where he was Professor of Finance. He brings with him significant industry experience, having held senior leadership roles at major airlines including JetBlue, where he most recently held the position of Chief Financial Officer.

He also worked for Northwest Airlines, where he held the position of Vice President Treasury, Corporate Finance; for Continental Airlines, where he was Treasurer and Associate General Counsel; and for GE Aviation, where he was Director Customer Finance and Commercial Engine Programs.

VACANCIES ANNOUNCEMENT - AIR TANZANIA

KENYA AIRWAYS BOOKS TICKETS FOR DIRECT US FLIGHTS STARTING OCTOBER 2018

A Kenya Airways plane in full flight. The airline is set to operate direct flights to and from the US.

Kenya Airways is set to commence daily flights between Nairobi and New York in October, marking a milestone for the national carrier that will cut the flight time between the two cities by more than seven hours.

Travellers will from Thursday begin booking advance tickets for the airline’s maiden flight to the John F. Kennedy International Airport (JFK).

Kenya Airways has already secured a landing slot at JFK.

The trans-Atlantic flights, scheduled to depart Jomo Kenyatta International Airport (JKIA) at 10:30pm every day, will last 15 hours.

This is a reduction from the current flight time of over 22 hours, including lengthy layovers.

“We are currently loading the flights onto our system. We shall go live and ready for bookings on Thursday,” said Kenya Airways chairman Michael Joseph in a telephone interview.

BANK OF TANZANIA LICENSES NEW COMMERCIAL BANK

NEW BANK OF TANZANIA GOVERNOR ASSUMES OFFICE, LICENCES NEW BANK

Bank of Tanzania Governor, Prof Florens Luoga led to his office by Acting Manager Public Relations and Protocol Department, Ms Anna Mlatie (not in the picture). On the Governor’s left is Acting Director of Human Resource and Administration, Ms Aziza Salum and Acting Manager Estates Department, Mr Christopher Nyondo.

The new Bank of Tanzania (BoT) governor Prof Florens Luoga assumed office on Monday with the Bank licencing new commercial bank, the Guaranty Trust Bank (Tanzania) Limited.

The licence, issued on December 28, 2018 allows the bank to carry out banking business in Tanzania as a commercial bank. The entry of the Guaranty Trust Tanzania into the market, that was licensed in December last year, brings the total number of commercial banks operating in the country to 38.

Prof Luoga told the BoT staff to work hard in building a strong and efficient institution that can provide solutions to challenges instead of entertaining the language of failure. “We are not here to entertain failures in the institution but provide best solutions to challenges facing the financial sector and the economy. If we fail, it means the country has failed. Thus, there is change for the language of failure at the BoT,” he said.

Prof Luoga said BoT works closely with many institutions from within and outside the country thus his first move will be to meet them. “I will start meeting key stakeholders of the Bank, citing few like the World Bank and the International Monetary Fund (IMF),” he said.

REAL ESTATE INVESTMENT - ECONOMIC EMPOWERMENT AND HOME OWNERSHIP

By Dr. Fred Msemwa

It is everybody’s dream to live and own a decent home. Unfortunately, realizing this dream is not an easy task considering the low income levels of the majority.

It is considered that the working class could be better positioned to have at least more access to decent homes compared to the majority of Tanzanians who work as peasant mainly practising subsistence farming. Experience gained from the real estate sector shows that the majority of the working class group can’t afford a home loan that exceed twenty five million.

This unfavourable development is caused by the level of salaries paid by the economy and higher interest rates on mortgage financing. A recent study commissioned in 2015 by the World Bank titled “ Stocktaking of the Housing Challenges in Sub-Saharan Africa” sheds light that even government sponsored housing programs meant to address housing challenges for the lower income group end up benefitting the high income group due to lack of affordability.

It is therefore not surprising that people in the lower income group resort to informal housing development that denies them to a myriad economic opportunities that are associated with owning registered properties. Housing is a basic human need, yet one-sixth of the world’s population lives in slums. Data from recent studies shows that 70% of the urban housing stock in Sub-Saharan Africa is of poor quality and out of compliance with local regulations.

SERIKALI KUZIFUTIA LESENI BENKI AMBAZO HAZITAJIUNGA NA MFUMO WA KIELEKTRONIKI WA KUKUSANYA MAPATO IFIKAPO JANUARI 31, 2018

DEADLINE SET FOR BANKS AND TELECOM FIRMS TO CONNECT TO DATA CENTRE

Finance and Planning Minister, Dr Philip Mpango.

All banks and telecom firms that will fail to connect to the Kijitonyama based electronic data centre by the end of this month will have their operating licences revoked, the government has warned. The directive was issued by the Finance and Planning Minister, Dr Philip Mpango on Tuesday, when he held talks with banks executives in Dar es Salaam.

According to the minister, in 2017, the government enacted the regulations for the Tax Administration Act, 2015, which require all banks and telecommunication companies to connect to the electronic system for payment of tax between June 2017 and December 31, 2017, but until yesterday, only 27 banks had complied with thelegal requirement.

“I have met almost 20 financial institutions to get to the bottom of why they were failing to implement the legal requirements, and among the reasons that I got was fear of the unknown; that because TRA was able to monitor all the transactions, they could easily be prone to cyber crime” he explained.

GUIDELINES ISSUED FOR REPLACING LOST VEHICLE REGISTRATION CARDS

TRA Director for Taxpayer Services and Education, Mr Richard Kayombo.

The Tanzania Revenue Authority (TRA) has detected that some owners of motor vehicles do not possess genuine car registration cards and directed them to publish in newspapers and report to the police if they lost the crucial documents before seeking duplicates.

Asked by ‘Daily News’ on the TRA’s motives to publish the advertisement in the newspaper to notify those concerned on the new directive, the authority’s Director for Taxpayer Services and Education, Mr Richard Kayombo, said although it was a normal procedure, its intention was to control and detect fake car registration cards.

“It is a normal procedure and to advertise in the newspaper and report to the police is required to put the record clear,” Mr Kayombo said, noting, “Some owners don’t have proper registration cards.”It had come to the authority’s notice, he explained, of dishonest individuals producing fake registration cards, prompting TRA to make interventions, primarily by controlling ownership of the crucial document.

OIL PRICES ARE AT THEIR HIGHEST LEVELS SINCE 2015

Oil’s rally is continuing, with benchmark Brent crude now trading at a two-year high above $US69 a barrel.

Prices climbed by as much as 2% overnight and have since consolidated in Asian trade. It marks a gain of around 11% since mid-December.

Investing.com

Developments in the middle east provided the catalyst for the latest rally, according to Greg McKenna at AxiTrader.

“What’s driven the price action overnight is continued focus on the fact OPEC won’t move quickly to plug any disruptions to supply from either Iran or Venezuela,” McKenna said.

“Equally there is some chat of the re-imposition of sanctions on Iran by President Trump.”

RAIS DKT. JOHN POMBE MAGUFULI AKUTANA NA KUFANYA MAZUNGUMZO NA WAZIRI MKUU MSTAAFU EDWARD LOWASSA IKULU JIJINI DAR ES SALAAM JANUARI 9, 2018

Rais wa Jamhuri ya Muungano wa Tanzania Mheshimiwa Dkt. John Pombe Magufuli akifurahia jambo na Waziri Mkuu Mstaafu Edward Lowassa mara baada ya kumaliza mazungumzo yao Ikulu jijini Dar es Salaam Januari 9,2018.

Rais wa Jamhuri ya Muungano wa Tanzania Mheshimiwa Dkt. John Pombe Magufuli akisalimiana na Waziri Mkuu Mstaafu Edward Lowassa mara baada ya kuwasili Ikulu jijini Dar es Salaam Januari 9,2018. 

Rais wa Jamhuri ya Muungano wa Tanzania Mheshimiwa Dkt. John Pombe Magufuli akiwa katika mazungumzo na Waziri Mkuu Mstaafu Edward Lowassa mara baada ya kuwasili Ikulu jijini Dar es Salaam Januari 9,2018. 

Rais wa Jamhuri ya Muungano wa Tanzania Mheshimiwa Dkt. John Pombe Magufuli akifurahi jambo na Waziri Mkuu Mstaafu Edward Lowassa mara baada ya kumaliza mazungumzo yao Ikulu jijini Dar es Salaam Januari 9,2018.

BOFYA HAPA KWA PICHA ZAIDI

BANKS, TELCOS GET DEADLINE ON TAX COLLECTION SYSTEM

In Summary

Finance and Planning minister Philip Mpango issued the ultimatum yesterday during a meeting with the heads of at least 20 financial institutions.

Dar es Salaam. Some banks and telecommunication companies risk losing their licences if they will not have subscribed to the electronic tax collection system by January 31.

Finance and Planning minister Philip Mpango issued the ultimatum yesterday during a meeting with the heads of at least 20 financial institutions.

He said the government last year enacted tax administration laws and regulations that required all banks and telecommunication companies to have joined the electronic tax collection system by December 31, 2017, but only 27 banks had so far done so.

“I have already met with at least 20 banks to establish why they have not joined the system as required by law and discovered that the majority of the banks fear that the system will expose them to cybercrime,” said Dr Mpango.

NEW BANK OF TANZANIA GOVERNOR REPORTS FOR DUTY

Dar es Salaam - The new Bank of Tanzania (BoT) Governor Prof Florens Luoga (pictured) has officially assumed the position, promising to work steadfastly to address challenges in the banking sector.

Prof Luoga, who assumed office yesterday was teaching law at the University of Dar es Salaam prior to his appointment as BoT governor by President John Magufuli last year, said he was humbled by the grand reception he received from the BoT staff.

“We are not here to fail in fulfilling our duties, because if we fail, the country fails too. Failure will not be tolerated,” he stressed.

Prof Luoga said his first act as new governor would be to meet with various central bank stakeholders within and outside the country.

“I must immediately start meeting with BoT important stakeholders, we cannot isolate ourselves from them and refuse to collaborate with the likes of IMF, World Bank,” he said.

TANZANIA REVENUE AUTHORITY COLLECTIONS UP BY 8.45%

TRA’s Director for Taxpayer Services and Education, Mr Richard Kayombo.

Revenue collection for the first half of FY 2017/2018 peaked at 7.87trl/-, an increase of 8.45 per cent against 7.27trl/- recorded in the corresponding period during FY 2016/2017.

In December, 2017 the Tanzania Revenue Authority (TRA) collected taxes amounting to 1.66trl/- as compared to 1.41trl/- which was collected in December, 2016, representing an increase of 17.65 per cent.

Speaking at a news conference in Dar es Salaam yesterday, TRA’s Director for Taxpayer Services and Education, Mr Richard Kayombo (pictured), also explained that tax collections in November 2017 stood at 1.26trl- against 1.12tr/- collected in November 2016.

During the period under review, it was only in September, 2017 that revenue collection stood at 1.34trl/-, which was -2.37 per cent short of 1.37trl/- collected during the same month in 2016.

Mr Kayombo praised taxpayers for enabling TRA to raise the funds, noting on the other hand that the tax collector is now embarking on a nationwide campaign to register taxpayers in which the Taxpayer Identification Number (TIN) is issued free of charge.

STANBIC BANK LAUNCHES HATUA ACCOUNT FOR CHILDREN

Stanbic Bank Tanzania Limited launches its Hatua Account in an effort to empower its customers’ financial success by promoting a saving culture for children.

Dar es Salaam, Saturday 06th January 2018 - Stanbic Bank Tanzania has launched Hatua account, a new savings solution that supports parents and guardians to save for their children while instilling a savings culture at an early age.

Stanbic bank continues to create banking solutions that promote financial growth and creation of wealth. It is through such products that the bank provides its customers with solutions that suit the needs of the family, helping their children grow with the bank and pave way for them to build their financial success for the future.

Speaking during the launch in Dar es Salaam, the bank’s Head of Sales, Shangwe Kisanji said, “we are constantly seeking ways to support our customers with managing their finances which includes saving for their children from an early age. The Stanbic Bank Hatua Account will empower their children’s future financial success, that will carry them through their life aspirations.”

OXFORD BUSINESS GROUP: DUBAI - YEAR IN REVIEW 2017

Increased activity in trade, tourism and construction paved the way for another year of growth in Dubai, with momentum expected to continue through 2018 as the emirate’s preparations for Expo 2020 shift up a gear.

Dubai’s economy looks set to expand by an estimated 3.3% in 2017, according to forecasts from the IMF, up from 2.9% in 2016 and well above the organisation’s projections for the wider UAE economy of 1.3%. Solid increases in foreign trade and infrastructure investments have been major drivers of growth.

Data issued by the Emirates NBD Dubai Economy Tracker Index at the beginning of November point to heightened activity in the later part of the year across key sectors of the economy, including construction, which posted its highest output growth for two years in October, and retail.

The index had reached 55.6 points by the end of October, up from 55.2 in September, and well above the 50-point cut-off that marks the difference between growth and contraction, putting Dubai on course to finish 2017 on a high.

The upwards trajectory is expected to continue into 2018; the IMF has forecast GDP growth of 3.5% for the year, supported by an anticipated rebound in energy prices and general business activity in the region.

Building works a major contributor to growth

Growth in the construction sector is being supported by a combination of projects for Expo 2020 and solid activity across the residential component of the industry.

According to a report prepared for Dubai’s annual construction industry fair, The Big Five, held at the end of November, around $8bn has been invested in transport and infrastructure projects related to the expo, while works at the site itself are valued at between $2bn and $4bn.

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OXFORD BUSINESS GROUP: SOUTH AFRICA - YEAR IN REVIEW 2017

A strong mid-year performance helped lift South Africa’s economy out of recession and back into positive territory in 2017. However, factors such as high unemployment and an expanding deficit could rein in growth in 2018.

Agriculture driving economic rebound

On the back of a 0.6% quarter-on-quarter (q-o-q) contraction between January and March 2017, the economy recorded q-o-q growth of 2.8% and 2% in April-June and July-September, respectively. The upturn pushed year-on-year (y-o-y) expansion over the January-to-September period to 1%.

Much of this growth was driven by the agricultural, forestry and fisheries sector, which rebounded from a drought in 2016 to increase by 21.9% y-o-y over the first nine months of 2017. In particular, the sector’s third-quarter expansion of 44.2% was the largest quarterly jump in more than 20 years.

Mining also made solid gains throughout the year, with higher gold and platinum output in the first nine months helping to drive y-o-y expansion of 4.3%.

Elsewhere, the transport and storage sector expanded by 1.2% from January to September, personal services rose by 1.1%, and finance and real estate services edged up by 1%. Manufacturing, however, recorded a 1.2% decline, despite a third-quarter rebound.

Significantly, household consumption continued to expand, rising by 1.4% in the first nine months and helping to boost broader economic activity.

Another positive sign was the recovery of trade figures; the country registered a trade surplus of R51bn ($3.8bn) from January to October, a significant improvement on the R10bn ($742.7m) deficit recorded for the same period in 2016. The strong result was in part due to higher shipments of coal and iron ore, and could be helped further should gold and platinum production rise in 2018.

Inflation also dipped throughout much of 2017, falling from 6.6% in January to 4.8% as of the end of October, according to official statistics. The October result meant that inflation remained under the central bank’s upper band target of 6% for the seventh month in a row.

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