IT IS a telling synchronicity that news of the government’s failure to implement a framework rescue package for the economy in response to the global economic crisis emerged at the same time that Trade and Industry Minister reiterated his department’s ambitious vision for state intervention in the economy to spur on growth.
As has been the case so often, the government’s grand visions are not matched by simple, practical back-up on the ground. If our policies are Mercedes-Benz, our implementation strategies are Dinky Toy.
The Department of Trade and Industry has precious little to show on industrial policy implementation, despite the policy having been on the table for almost two years already. Now it has emerged that the crisis document — the implementation of which is imperative to keep exactly those manufacturing assets the state wants to target with industrial policy — is also gathering dust.
This throws into stark relief the irony of Davies’s references to market failures and casting the government as a knight in shining armour that is going to ride in and save the economy, create jobs and meaningfully address poverty.
In fact, the assumption is a little rich, given that many structural problems plaguing the competitiveness of firms, such as inadequate rail transport infrastructure, expensive telecommunication services and above-inflation increases in administered prices, are exactly the fault of the state.
Also bear in mind that some of the abnormalities in the system — including, for instance, the high level of concentration of ownership in sectors which provide strategic inputs into the economy — are in fact a hangover from ill-considered industrial policy implementation in the past.
RIO Tinto’s iron-ore contract price negotiations with its Chinese clients are perhaps the most significant of recent years, and not just for Rio. The talks have dragged on much longer than in previous years, and are now past the June 30 deadline.
What is not in doubt is that iron- ore prices will come down — the only question is by how much. Japanese, Korean and Taiwanese steel producers of iron-ore fines have accepted a 33% cut, but the Chinese are holding out for more.
The standoff demonstrates the tentative nature of the turnaround, and also perhaps China’s growing leverage in the iron-ore market.
China has for some years now constituted about a third of global steel production. This proportion has increase over the past two years as global production outside of China has declined. Steel production has declined in China too, but not by as much as elsewhere.
If the Chinese accept the 33% cut like their Asian counterparts, then it can be assumed this decline has reversed, which will reinforce confidence of a stronger economic turnaround in China than expected. If they don’t, then confidence of increased Chinese growth within a core industry in China itself will probably be at best static, like the economy as a whole.
IS IT possible? Can South Africans look forward to quiet evenings without being interrupted by calls from telemarketers?
The new Consumer Protection Act, which highlights the consumer’s fundamental rights to privacy and fair and responsible marketing, bans a number of selling and marketing practices and regulates others.
It prevents suppliers from engaging in any direct marketing directed to a consumer “at home” for any promotional purpose during a “prohibited period” — expected to be the early hours of the morning and late evenings.
Consumers will be able to “block” direct marketing.
A registry will be set up for the purposes of blocking or pre-emptive blocking of direct marketing. Only time will tell if that means the end of the dreaded spam.
Neil Kirby of Werksmans points out one difficulty with the provisions: they appear to apply only to the consumer “at home”. This may prove difficult to enforce as marketers contacting consumers on a cell number, for instance, may not know whether the consumer is “at home” or not.