South African-based diversified resources company Exxaro and India's Tata Power have launched a joint venture company that aims to take advantage of renewable energy projects in South Africa and on the continent.

The new company, Cennergi (Pty) Limited, will be a 50:50 joint venture between Exxaro and Tata Power through its subsidiary Khopoli Investments.

Based in South Africa, Cennergi will focus on acquiring and developing electricity generation projects in South Africa, Botswana and Namibia, starting with renewable energy projects in South Africa.

An expanding energy market

"Cennergi has been created by companies from developing nations to serve developing nations," Exxaro CEO Sipho Nkosi said in a statement on Monday. "We expect Cennergi to play a key role in the African electricity generation market."

Nkosi said Cennergi aimed to be the leading cleaner energy independent power producer (IPP) in southern Africa, serving an expanding energy market.

"This partnership with Tata Power will add the skills and capabilities necessary to create a world-class energy company in this region with enormous growth opportunities."

'High-quality, sustainable projects'

Tata Power MD Anil Sardana said the joint venture was in line with the company's strategy of pursuing exploration opportunities for energy development in growing markets.

"We look forward to working together with Exxaro to jointly develop efficient, high-quality and sustainable projects that will bring significant benefits to the region as well as local communities.

"Through this partnership, we will be able to pursue business opportunities holistically and make a responsible contribution in this high-potential region."

SAinfo reporter

Business has welcomed Finance Minister Pravin Gordhan's 2012 Budget, saying it rightly emphasized the need for a collaborative effort from all South Africans in working towards a growing, inclusive, job-rich economy against the backdrop of a weak global economic outlook.

Business Unity South Africa (Busa) described the Budget as credible, broadly balanced and confidence-building, saying it was pleased with the central priority the Budget placed on the expanded infrastructure programme.

"This initiative should not only aid in building modern infrastructure, but will also reduce poverty, create decent work and expand employment opportunities," Busa said in a statement on Thursday.

Need to be globally competitive

Busa was further pleased with the emphasis on the need for South Africa to be globally competitive, further tax relief for small business and micro-enterprises, and a simplified tax regime for SMMEs.

It said the small and emerging business sector had the greatest potential for job creation.

"We welcome as business additional allocations of R55.9-billion over the next three years and an additional R9.5-billion for an economic support package.

"We also welcome the 43 major infrastructure projects and further detail on how they will be funded. In this vein, we look forward to the infrastructure summit which the President is planning to convene soon," said Busa.

Sars commended for raising R739-billion

The Banking Association of South Africa commended the South African Revenue Service for raising R739-billion under difficult economic conditions. "The national Budget has, for the first time, passed R1-trillion, highlighting the significant expenditure by government," it said.

The association said Gordhan had demonstrated visionary, honest and practical leadership.

In his speech, Gordhan commented on the high banking costs in South Africa. The association said that, while increasing competition in the sector was leading to a more efficient sector with lower costs, had to be noted that South Africa had high broadband costs, costs of protecting cash and significant compliance costs.

It said it was working with National Treasury in this regard.

Dividends tax rate increase 'a shock'

Des Kruger, Director: Tax at Webber Wentzel law firm said that the increase in the dividends tax rate had come as a shock, given that all previous announcements and the law as it stands at present indicated a 10% rate.

"The proposed 50% increase in the dividends tax rate to 15% so late in the day will no doubt cause considerable administration burdens on those companies and regulated intermediaries that have to account for the tax," said Kruger.

He added that foreigners owning property in South Africa would be adversely affected by the increase in inclusion capital gains tax (CGT) rates, because non-residents are required to pay CGT on the disposal of any immovable property owned by them in South Africa.

However, Kruger did welcome the proposal to allow a deduction for interest incurred on the acquisition of shares to be deductible in certain circumstances.

PKF chartered accountants and business advisers was surprised by the unexpected increase in the rate at which the new Dividends Tax was being levied at 15% - when 10% had been anticipated - and the increase in the rate of capital gains tax (CGT) from 10% to 13.3% for individuals, from 14% to 18.6% for companies and from 20% to 26.7% for trusts.

'High-income earners targeted'

Eugene du Plessis, director of tax at the company said the Budget had hit the high net worth individual (HNWI) sector.

"They are targeting the HNWI with measures that can only affect the wealthy, and by removing legitimate means of reducing their tax burden," Du Plessis said.

"While this is being viewed as 'a more equitable means of spreading the load', targeting the high proportion of their income that HNWIs earn from passive investments, in reality it is making South Africa such a high-tax country for the wealthy that there is little incentive for them to live here as opposed to more developed countries."

The coalition of the Congress of South African Trade Unions (Cosatu), the South African Council of Churches (SACC) and the South African Non-Governmental Organisation Coalition (Sangoco) said it welcomed that government spending would be increased to 32% of GDP in 2012/13.

State 'must learn to spend its allocations better'

However, the coalition said, it was concerned at the capacity in national departments, provincial governments and local municipalities to spend the allocated amounts in a manner that will boost the industrial capacity of the economy and create decent jobs.

The coalition, referred to as the People's Budget Campaign (PBC), said it was concerned that the Budget deficit would decrease to 3% of GDP by 2014.

"The unpredictability of the current economic crisis in Europe will continue to impact our economy negatively," the PBC said. "It is therefore important for government to avoid decreasing the budget deficit over the MTEF and thus prevent our economy from deteriorating into a second-round recession.

"Cutting deficit spending is simply not a sound economic measure given the global economic crisis and the triple crisis we continue to face at home."

While the coalition welcomed the allocation of infrastructure spend to the tune of R3.2-trillion over the three-year period, it said it must be complimented by the need to increase the capacity of the state to appropriately spend the allocated amounts.

"We welcome the proposed establishment of the municipal infrastructure support agency that will enhance infrastructure development capacity of the rural municipalities."

The coalition said it rejected the proposed adjustments in tariffs by the minister regarding e-tolling in Gauteng to pay for the Gauteng Freeway Improvement Project.

"The PBC rejects the continued reliance on user pay principle in the development of road infrastructure. We do not support e-tolling and call for a reliable, safe, affordable and integrated transport system," it said, noting the acknowledgement made by Gordhan that the e-tolling system will have a negative impact on the road users in the province and workers in particular.

The coalition said it was appalled that some learners were still being taught in mud houses, and demanded the elimination of them in the financial year. The Budget also failed to reduce teacher-learner ratios in the rural and township schools, it said.

Source: BuaNews

First-world infrastructure plus a vibrant emerging market equals huge investment potential!

A major industrialisation drive across Africa is needed for the continent to transform its current growth spurt into sustained social and economic development, Trade and Industry Minister Rob Davies told the South Africa-Turkey Business Forum in Istanbul on Thursday.

Davies said that a general improvement in economic governance across Africa underpinned the growth spurt the continent was experiencing. "However, the challenge facing Africa is to transform that growth spurt into a sustained effort and development.

The business forum included break-away sessions and business-to-business meetings between South African and Turkish business people.

Africa 'can't grow on raw material exports alone'

Davies told the meeting that Africa could not continue to grow simply on the basis of the supply of raw materials to fuel industrialisation processes taking place elsewhere.

He stressed that in order to address this, the continent had to engage "in a series of exciting ventures to boost and expand regional integration".

According to the minister, lack of infrastructure as well as the lack of productive capacity were the biggest barriers to inter-regional trade in Africa.

"To overcome this, we need to promote a significant industrialisation effort across the continent."

SA, Turkey trade 'well below potential'

Davies told the forum that bilateral relations between South Africa and Turkey were currently well below their potential.

In 2009, trade between South Africa and Turkey decreased significantly, mainly due to the global economic crisis.

In total, trade decreased from R10.6-billion in 2008 to R5.1-billion in 2009 and further to R4.9-billion in 2010, after an upward trend from 2006 to 2008.

"The trade decrease is of concern, but there is certainly room to grow the volume of two-way trade and investment, create a more diversified balance of SA exports, a greater proportion of beneficiated and higher value goods and services in our export basket to Turkey."

Later on Thursday, Davies was due to co-chair the second session of the Turkey-South Africa Joint Economic Commission, which promotes trade, investment and economic co-operation between the two countries.

Source: BuaNews

President Jacob Zuma's State of the Nation address should focus on the implementation of policies and programmes already agreed to, says Business Unity South Africa (Busa).

"In President Zuma's third year in office, 2012 must be a year of 'game change' for implementation," Busa said in a statement on Wednesday.

"Business expects the address to give a comprehensive platform on which business, government, labour and community can continue to position South Africa on a higher, more inclusive and job-rich growth path - and expediting what has been agreed in programmes such as the New Growth Path and the National Development Plan."

President Zuma will deliver the State of the Nation Address in Parliament, Cape Town at 7pm on Thursday evening. The address will be broadcast live on SABC television and radio and streamed live on www.gov.za.

• More info on the State of the Nation address and how to follow it: www.info.gov.za/events/2012/sona/

Busa said it hoped the overall message of the address would help underpin investor confidence and the role of business in order to strengthen South Africa's economic recovery and promote growth.

It also hoped that the address would throw its weight behind strengthening an entrepreneurial culture in the country.

"The prioritisation of job creation, poverty reduction, education, economic transformation, infrastructural development and growth must be invested with a new sense of urgency," Busa said.

"We believe it is in small business that the greatest potential lies for realising South Africa's employment targets."

Source: BuaNews

The Parliamentary portfolio committee on human settlements has decided to redraft the proposed Rental Housing Amendment Bill, committee chairwoman Nomhle Dambuza said on Wednesday.

"Applying for a redraft of this amendment bill requires that another set of public hearings be held and we believe that this will give an opportunity to the parties who did not comment during the first round," Dambuza said in a statement.

She said she decided to revert the bill to the committee and not the department because of the proposed amendments.

The committee decided to redraft the amendment bill so that it covered aspects raised by the department of human settlements and addressed the loopholes and ambiguities identified in the Rental Housing Act and the Rental Housing Amendment Act.

Dambuza said the Rental Housing Amendment Act had gaps which could lead to people's exploitation.

"Complaints... suggested that there are lot of problems in the rental sector and we hope that redrafting this bill will minimise those challenges.

"In our view, the redraft provides a balanced view of how challenges faced by landlords as well as tenants should be addressed," said Dambuza.

Rental Housing Tribunals

Last year, the department sought to amend the Rental Housing Act to make MECs responsible for establishing Rental Housing Tribunals and to extend the powers of tribunals so that they could withdraw or vary any rulings.

However, Dambuza said the committee noticed that the rights and obligations of landlords and tenants were not clearly spelled out and that some of the public comments raised during the department's public hearings were not accommodated in the proposed amendment bill.

The proposed redraft obliged landlords to: reimburse rental deposit with accrued interest, provide regular maintenance to tenants' properties or rooms and written agreements and receipts for every payment made, reserve the right to recover money owed to them, and terminate leases on grounds that did not constitute unfair practice and were specified in the lease.

Sapa

Opportunities, incentives, regulations, assistance.

South African researchers will conduct a R2-million research project in a bid to scientifically showcase the soothing, disease-prevention and weight-loss properties of rooibos tea, The Star reported on Wednesday.

The research, which will include examining the anti-ageing, anti-obesity and cancer-preventing properties of the tea, will be conducted this year, the newspaper reported.

The South African Rooibos Council has set aside a budget for the research.

There is a "long held belief" that a cup of rooibos tea helps one relax and cope better with stress.

The University of Stellenbosch biochemistry department research team, led by Professor Amanda Swart, found that the tea contains components that can help alleviate stress and anxiety.

The team has already identified two rare components of rooibos - aspalathin and nothofagin - that contribute to the stress-lowering effect. These findings were published last year.

Sapa

Opportunities, incentives, regulations, assistance.

BMW SA said on Monday that approximately 3 350 customers in South Africa would be affected by Mini's worldwide technical recall of Mini Cooper S and John Cooper Works models.

BMW SA spokesperson Guy Kilfoil said Mini was conducting a worldwide technical recall of turbocharged Mini Cooper S (R55, R56, R57 and R60 body derivatives), and Mini John Cooper Works models (R55, R56, R57 body derivatives) built between March 2006 and October 2010, due to a potential fault with the additional water pump fitted in these models.

"Approximately 3 350 local customers will be affected," Kilfoil said in a statement this week. "These customers will be notified to arrange for the replacement of the additional water pump free of charge during January 2012.

"It is anticipated that it will take no longer than an hour to replace the affected part."

Under high operating temperatures an electro-migration can occur at the circuit board installed in the additional water pump, leading to a failure of the additional water pump. The potential exists for this failure to manifest itself in an overheating of the circuit board, BMW South Africa explained.

"Mini has not received any reports, nor is aware of any accidents or injuries relating to this matter, and owners are still able to drive their vehicles," Kilfoil said.

"However, we recommend that owners of affected vehicles, who receive a letter asking them to have this service performed by their authorised Mini Dealer, do so as soon as possible."

Affected owners can contact their nearest Mini dealer or Mini Customer Care on 0800 696 464 to make the necessary arrangements for the replacement.

Sapa

Opportunities, incentives, regulations, assistance.

South African logistics group Transnet and Swaziland Railways have agreed to jointly develop a 146-kilometre railway line from Lothair in Mpumalanga to Sidvokodvo Junction in Swaziland, as well as upgrade the adjacent railway networks in both countries.

According to a Business Day article on Friday, the R17-billion project will be the biggest railway investment in southern Africa since 1976.

The cost of building the main "Swazilink" railway line would be R7.3-billion, Business Day reported, with R8.6-billion to be spent on 600 kilometres of adjacent lines. Swaziland will be responsible for providing about R5-billion of the investment amount.

Once completed, the new rail line is expected to create additional capacity of 15-million tons, which will predominantly be general freight volumes from the existing coal export rail line.

"This is the first large-scale rail investment in Southern Africa since the construction of the Richards Bay line in 1976," Transnet CEO Brian Molefe said in a statement this week.

He added that the investment was complementary to the company's other large coal investments, still to be rolled out, including the Waterberg line and Eskom's road-to-rail migration programme.

Global rail renaissance

Molefe said that globally, rail infrastructure was undergoing a major renaissance as an investment and a vehicle to uplift citizens in an environmentally friendly and cost-effective manner.

"We are proud to be part of this revolution," he said. "As Transnet we have already done a high-level risk assessment to identify the strategic, planning, financial, construction and environmental risks to ensure that this great multi-infrastructural project sees its day."

He said the company expected the first train to run in three years' time after the necessary land purchase agreements and environmental approvals had been resolved.

SAinfo reporter

Amid calls for a more coordinated, flexible and differentiated education system capable of accommodating more of South Africa's school-leavers, Higher Education Minister Blade Nzimande has reminded the country's post-matrics of opportunities available outside universities.

Higher Education South Africa called on Wednesday for the development of a coordinated, flexible and differentiated post-school education and training system that pulls in the country's universities, FET institutions, and agricultural, nursing and teacher training colleges.

Higher Education SA also pledged its support to any initiative aimed at providing a greater set of study opportunities for school leavers, following an incident on Tuesday where a parent was killed during a stampede by late first-year applicants at the University of Johannesburg.

Opportunities 'beyond universities'

Last week, Nzimande reminded school-leavers of the various options available to them, saying they should consider state Further Education and Training (FET) colleges, where a wide range of in-demand skills were on offer.

Nzimande said there were opportunities beyond universities - in learnerships, artisan training and internships, as well as in FET colleges, nursing and agricultural colleges.

"Public FET colleges, in particular, offer skills that are in line with the country's growth and development imperatives," Nzimande said.

"Even as we speak, our economy has a higher and more urgent demand for artisans, technicians, engineers and other scarce skills that can be sourced outside of universities."

Financial assistance at state insitutions

Nzimande added that there was financial assistance available for deserving students from poor families through the National Financial Student Aid Scheme.

He noted that students attending private higher education institutions did not qualify for government student financial aid.

Following Tuesday's incident at the University of Johannesburg, Nzimande said the government was considering halting the late application practice, and planned to roll out a centralised applications system of the kind already being used in KwaZulu-Natal.

Higher Education SA said that, in order to learn from the UJ incident, it would "examine the experiences of its 23 member institutions relating to admissions in 2012 with a view to analysing trends, distilling lessons and facilitating mechanisms through which promising practices could be shared across the university system".

Source: BuaNews