by Greg Simpson

Editor's Note

Off with a bang

Gregory Simpson
The year has hardly started and the roller coaster that is the South African economy is already in full swing, with mining hogging the headlines on the finance pages after protracted labour negotiations, together with fearsome natural disasters the world over which continue to shake up the insurance industry.
The mining sector, one of the cornerstones of our flourishing economy is struggling to find a balance between internationally competitive wage demands and productivity.
In reality, our miners are far less skilled than their international counterparts and thus comparisons in wages are not fair, and could well nosedive the entire industry, not to mention fragile share prices if they are not handled in a sustainable manner.
It is an unfortunate legacy of apartheid that perpetuates through many of the older miners who never had access to a decent education. If our miners’ wage demands were met in full over the next five years, a great many jobs would be lost to balance the books. And output per miner would have to increase significantly. 
South Africa’s financial sector relies heavily on the minerals sector to push our gross domestic product along, and the job cuts that miners are experiencing at the moment are in large part a natural process of making our mines more streamlined and competitive against more technically advanced miners from other regions.
The days of a massive semi-skilled labour force are gone – it is understandable that unions want to get the most out for their clients – but should really tread carefully and not upset the applecart to the point of tipping.
Natural disasters have also grabbed the headlines of late, with people finding out the hard way whether they were accurately covered or not. As cities pop up closer and closer to sensitive ecological areas, the chance of large scale financial damage is ever increased, placing a higher risk on insurance companies, while consumers have more to think about when assessing exactly what needs to be insured.
With the upcoming budget speech, the Minister of Finance, Pravin Gordhan, has once again been a steadying influence in the economy, with a father like approach.
Indeed, I would have to rate him as one of our top ministers.
As you have come to expect, we have another line-up of top professionals contributing to make this edition one to
savour. JSE CEO Nicky Newton-King joins the ranks with a regular column, breaking down all the good stuff in one of South Africa’s power women’s lives.
We end off with a peek at the almighty Lamborghini Aventador, which is sure to make more than a few heads turn all the way up to the whopping 350km/h top speed. A special thanks to Dr Mike Mulder, who performed successful surgery on my torn Achilles Tendon over the holidays.
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Issue 70


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