South Africa 2010

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South Africa 2010

  1. 1. South Africa SEB MERCHANT BANKING –– COUNTRY RISK ANALYSIS April 21, 2010 Analyst: Jenny Nordgren. Tel : +46 8 763 96 05. E-mail : jenny.nordgren@seb.se South Africa is recovering from its deepest recession since the fall of apartheid. Despite some fear of populist policies, the new administration has kept economic policies broadly intact. Maintained commitment to prudent policies and public debt at a modest level is key to sustained market confidence. Country Risk Analysis qÜÉ=ÉÅçåçãó=áë=êÉÅçîÉêáåÖ=Ñêçã=áíë=ïçêëí=êÉÅÉëëáçå=ëáåÅÉ=NVVNJVOK=oÉ~ä=dam= ÖêçïíÜ=ÑÉää=Äó=~äãçëí=O=B=áå=OMMV=ã~áåäó=ÇìÉ=íç=~=Åçåíê~Åíáçå=áå=ã~áå=Éñéçêí=ëÉÅíçêëI= ã~åìÑ~ÅíìêáåÖ=~åÇ=ãáåáåÖI=~ë= ïÉää=~ë=áå=~ÖêáÅìäíìêÉK=qÜÉ= Real GDP (2008-2009) ÉÅçåçãóI=ÜçïÉîÉêI=êÉíìêåÉÇ=íç= 6 éçëáíáîÉ=ÖêçïíÜ=áå=nPI=HMKV=B=óÉ~ê= Annual percentage change 4 çå=óÉ~ê=EóçóFI=~åÇ=nQI=HPKO=B=óçóI= 2 ÇìÉ=íç=~=êÉÄçìåÇ=áå= 0 ã~åìÑ~ÅíìêáåÖ=~åÇ=ÅçåíáåìÉÇ= Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 -2 êçÄìëí=ÖêçïíÜ=áå=ÅçåëíêìÅíáçåK= -4 aÉëéáíÉ=~å=ÉñéÉÅíÉÇ=Äççëí=Ñêçã= -6 íÜÉ=OMNM=cfc^=tçêäÇ=`ìéI=íÜÉ= -8 êÉÅçîÉêó=áë=ÉñéÉÅíÉÇ=íç=ÄÉ=ãçÇÉëí= íÜáë=óÉ~ê=ÇìÉ=íç=ïÉ~â=éêáî~íÉ=Åçåëìãéíáçå=Ü~êãÉÇ=Äó=ÜáÖÜ=ìåÉãéäçóãÉåí=EOP=BF= ~åÇ=ÜçìëÉÜçäÇ=ÇÉÄí=äÉîÉäë=âÉÉéáåÖ=dam=ÖêçïíÜ=ÄÉäçï=éçíÉåíá~ä=~í=àìëí=~ÄçîÉ=O=BK= = pÜ~êé=áåíÉêÉëí=ê~íÉ=Åìíë=~åÇ=áãéêçîÉÇ=ã~êâÉí=ÅçåÑáÇÉåÅÉK=fåÑä~íáçå=Ü~ë=Ñ~ääÉå= ëÜ~êéäó=çîÉê=íÜÉ=é~ëí=óÉ~ê=ÇêçééáåÖ=Ä~Åâ=ïáíÜáå=íÜÉ=`Éåíê~ä=_~åâÛë=PJS=éÉêÅÉåí= í~êÖÉí=ê~åÖÉ=áå=ä~ëí=cÉÄêì~êó=~ääçïáåÖ=íÜÉ=`Éåíê~ä=_~åâ=íç=Åìí=áåíÉêÉëí=ê~íÉë=Äó=RRM= Ä~ëáë=éçáåíë=íç=RKRB=é~K=çîÉê=~=NR=ãçåíÜë=éÉêáçÇ=íç=j~êÅÜI=OMNMK=kçíïáíÜëí~åÇáåÖ= íÜÉ=áåíÉêÉëí=ê~íÉë=ÅìíëI=íÜÉ=ÉñÅÜ~åÖÉ=ê~íÉ=çÑ=íÜÉ=ê~åÇ=Ü~ë=ëíêÉåÖíÜÉåÉÇ=Ä~Åâ=íç=áíë=éêÉJ Åêáëáë=äÉîÉä=~åÇ=íÜÉ=ëíçÅâ=ã~êâÉí=Ü~ë=êÉÅçîÉêÉÇ=ëíêçåÖäó=êÉÑäÉÅíáåÖ=áå=é~êí=~=êÉíìêå=çÑ= éçêíÑçäáç=Éèìáíó=áåÑäçïëK=j~êâÉí=ÅçåÑáÇÉåÅÉ=Ü~ë=áãéêçîÉÇ=áå=äáåÉ=ïáíÜ=íÜÉ=ïáÇÉê= êÉÅçîÉêó=áå=ÉãÉêÖáåÖ=ã~êâÉí=ëÉåíáãÉåí=éìëÜáåÖ=Ççïå=íÜÉ=`apJëéêÉ~Ç=íç=éêÉJ pÉéíÉãÄÉê=OMMU=äÉîÉäëK== = k~êêçïáåÖ=ÅìêêÉåí=~ÅÅçìåí=ÇÉÑáÅáíK=qÜÉ=ÅìêêÉåí=~ÅÅçìåí=ÇÉÑáÅáí=å~êêçïÉÇ=íç=~êçìåÇ= Q=B=çÑ=dam=áå=OMMV=Ñêçã=~êçìåÇ=T=B=íÜÉ=íïç=éêÉîáçìë=óÉ~êëK==qÜáë=ï~ë=ÇìÉ=íç=~= äçïÉê=ÇÉÑáÅáí=áå=íÜÉ=íê~ÇÉ=Ä~ä~åÅÉ=~ë=ïÉää=~ë=íÜÉ=áåÅçãÉ=~åÇ=ëÉêîáÅÉë=Ä~ä~åÅÉK= eçïÉîÉêI=íÜÉ=ÅìêêÉåí=~ÅÅçìåí=ÇÉÑáÅáí=áë=ÉñéÉÅíÉÇ=íç=ïáÇÉå=~Ö~áå=ã~áåäó=ÇìÉ=íç= ÜáÖÜÉê=çáä=éêáÅÉë=~åÇ=áãéçêíë=çÑ=Å~éáí~ä=ÖççÇëK=pç=Ñ~ê=áí=Ü~ë=ÄÉÉå=ÅçãÑçêí~Ääó= Ñáå~åÅÉÇ=Äó=Å~éáí~ä=áåÑäçïëI=áåÅäìÇáåÖ=ÑçêÉáÖå=ÇáêÉÅí=áåîÉëíãÉåíëI=cafI=~åÇ=ãçêÉ= êÉÅÉåíäó=~äëç=ÑçêÉáÖå=éçêíÑçäáç=áåîÉëíãÉåíë=áå=äçÅ~ä=ëÉÅìêáíó=ã~êâÉíëK==^ë=~=êÉëìäíI=íÜÉ= Ä~ä~åÅÉ=çÑ=é~óãÉåí=éçëáíáçå=Ü~ë=êÉã~áåÉÇ=êçÄìëí=~åÇ=áåíÉêå~íáçå~ä=êÉëÉêîÉë=Ü~îÉ= important your attention is drawn to the statement on the back cover of this report which affects your rights.
  2. 2. SEB Merchant Banking Country Risk Analysis April, 2010 êáëÉå=~ë=íÜÉ=ÅÉåíê~ä=Ä~åâ=Ü~ë=ÄçìÖÜí=ÉñÅÉëë=ÑçêÉáÖå=ÉñÅÜ~åÖÉ=íç=~îçáÇ=~=íçç=ê~éáÇ= ~ééêÉÅá~íáçå=çÑ=íÜÉ=ê~åÇK==dêçëë=ÉñíÉêå~ä=ÇÉÄí=êÉã~áåë=äçï=~í=~êçìåÇ=PM=B=çÑ=dam= ~åÇ=ëÜçêíJíÉêã=ÇÉÄí=çÑ=rpa=OOÄå=áë=Ñìääó=ÅçîÉêÉÇ=Äó=cu=êÉëÉêîÉë=çÑ=rpa=PVÄåK== = píêçåÖ=ÑáëÅ~ä=ëíáãìäìëK=mìÄäáÅ=Ñáå~åÅÉë=ÇÉíÉêáçê~íÉÇ=ëÜ~êéäó=áå=cv=OMMV=EÉåÇáåÖ= j~êÅÜ=PNI=OMNMF=ÇìÉ=íç=~=ëÜ~êé=Çêçé=áå=í~ñ=êÉîÉåìÉë=~åÇ=éìÄäáÅ=ëÉÅíçê=é~ó=êáëÉëK=^ë=~= êÉëìäíI=íÜÉ=ÄìÇÖÉí=ÇÉÑáÅáí=ïáÇÉåÉÇ= Ñêçã=NKO=B=áå=cv=OMMU=íç=TKO=B=áå=cv= Public finances OMMVI=ÇçìÄäÉ=íÜÉ=çêáÖáå~ääó=ÄìÇÖÉíÉÇ= PKU=B=çÑ=damK==qÜÉ=OMNM=_ìÇÖÉí= 2% 50% éêÉëÉåíÉÇ=áå=ãáÇJcÉÄêì~êó=~ëëìãÉë=~= 0% 40% % of GDP % of GDP å~êêçïáåÖ=çÑ=íÜÉ=ÄìÇÖÉí=ÇÉÑáÅáí=íç=SKR= -2% 30% B=çÑ=dam=áå=cv=OMNM=~åÇ=~=ëíÉ~Çáäó= -4% 20% ÇÉÅäáåÉ=íç=QKT=B=áå=cvOMNO=Äó= -6% 10% Åçåí~áåáåÖ=ÖêçïíÜ=çÑ=ÉñéÉåÇáíìêÉëI= -8% 0% 2005 2006 2007 2008 2009 2010 2011 2012 ~åÇ=Äó=ê~íáçå~äáëáåÖ=éìÄäáÅ=ëÉêîáÅÉëK== Budget balance (LHS) Public debt (RHS) qÜÉ=ÅçìåíÉêÅóÅäáÅ~ä=ÑáëÅ~ä=éçäáÅó= ÇìêáåÖ=íÜÉ=êÉÅÉëëáçå=Ü~ë=êÉîÉêëÉÇ=êÉÅÉåí=óÉ~êëÛ=éçëáíáîÉ=ÇÉÄí=Çóå~ãáÅë=~åÇ=ïáää= ëÜ~êéäó=áåÅêÉ~ëÉ=íÜÉ=ÇÉÄíJíçJdam=ê~íáç=Ñêçã=PM=B=áå=cv=OMMU=íç=QQ=B=çÑ=dam=áå=cv= OMNOI=ëíáää=ãçÇÉëíI=íÜçìÖÜI=Åçãé~êÉÇ=ïáíÜ=ã~åó=éÉÉêëK= = kÉï=éçäáÅáÉëI=Äìí=ÉÅçåçãáÅ=éçäáÅáÉë=Äêç~Çäó=áåí~ÅíK=^k`JäÉ~ÇÉê=g~ÅçÄ=wìã~= ÄÉÅ~ãÉ=mêÉëáÇÉåí=ÑçääçïáåÖ=^k`Ûë=ä~åÇëäáÇÉ=îáÅíçêó=áå=^éêáä=OMMV=ÉäÉÅíáçåëK=pçãÉ= çÄëÉêîÉêë=ÑÉ~êÉÇ=íÜ~í=~=wìã~=éêÉëáÇÉåÅó=ïçìäÇ=êÉëìäí=áå=éçéìäáëí=éçäáÅáÉë= íÜêÉ~íÉåáåÖ=íÜÉ=ÉÅçåçãáÅ=éçäáÅó=Ñê~ãÉïçêâ=çÑ=íÜÉ=éêÉîáçìë=~Çãáåáëíê~íáçåK=_ìí=íÜÉ= åÉï=íÉ~ãI=áåÅäìÇáåÖ=~=åÉï=Ñáå~åÅÉ=ãáåáëíÉê=~åÇ=~=åÉï=ÅÉåíê~ä=Ä~åâ=ÖçîÉêåçêI=Ü~ë=ëç= Ñ~ê=âÉéí=íÜÉ=éçäáÅó=Ñê~ãÉïçêâ=çÑ=íÜÉ=éêÉîáçìë=~Çãáåáëíê~íáçå=Äêç~Çäó=áåí~ÅíK=qÜÉ= jÉÇáìã=qÉêã=_ìÇÖÉí=mçäáÅó=pí~íÉãÉåí=Ejq_mpF=çÑ=ä~ëí=lÅíçÄÉê=~åÇ=íÜÉ=OMNM= _ìÇÖÉí=éêÉëÉåíÉÇ=Äó=íÜÉ=åÉï= Unemployment Rate cáå~åÅÉ=jáåáëíÉê=mê~îáå=dçêÇÜ~å= 25.5 ã~å~ÖÉÇ=íç=ëíêáâÉ=~=Ä~ä~åÅÉ= 25.0 ÄÉíïÉÉå=ÑáëÅ~ä=éêìÇÉåÅÉ=~åÇ=âÉó= 24.5 éêáçêáíáÉë=áåÅäìÇáåÖ=áåÑê~ëíêìÅíìêÉ= 24.0 áåîÉëíãÉåíëI=éçîÉêíó=~ääÉîá~íáçå= Percent 23.5 ~åÇ=áãéêçîáåÖ=íÜÉ=èì~äáíó=çÑ= 23.0 ÉÇìÅ~íáçå=~åÇ=ÜÉ~äíÜ=Å~êÉK==qÜÉ= tçêäÇ=_~åâ=Et_F=Ü~ë=~äëç=êÉÅÉåíäó= 22.5 áãéêçîÉÇ=~=rpa=PKTRÄå=äç~å=íç= 22.0 bëâçã=EíÜÉ=ëí~íÉ=çïåÉÇ=ÖÉåÉê~íçêF= 21.5 Q1 Q1 Q2 Q4 Q2 Q4 íç=ÄìáäÇ=~=Åç~äJÑáêÉ=éä~åí=áå=çêÇÉê= 05 06 07 08 09 10 Source: Reuters EcoWin íç=~îçáÇ=íÜÉ=Ää~ÅâJçìíë= ÉñéÉêáÉåÅÉÇ=áå=OMMT=~åÇ=É~êäó=OMMUK=qÜÉ=t_=äç~åI=ïÜáÅÜ=Ü~ë=ÄÉÉå=ÅêáíáÅáëÉÇ=Äó= ÉåîáêçåãÉåí~äáëíëI=~áãë=íç=ÄÉåÉÑáí=íÜÉ=éççê=íÜêçìÖÜ=àçÄ=ÅêÉ~íáçå=~åÇ=ãçêÉ=êÉäá~ÄäÉ= ëìééäó=çÑ=ÉäÉÅíêáÅ~ä=éçïÉêK=vÉíI=ëçÅáçÉÅçåçãáÅ=éêÉëëìêÉ=ëíÉããáåÖ=Ñêçã=ä~êÖÉ=áåÅçãÉ= áåÉèì~äáíáÉë=~åÇ=ÜáÖÜ=äÉîÉäë=çÑ=ìåÉãéäçóãÉåí=ã~áåäó=~ãçåÖ=éççê=Ää~Åâë=ÅçåíáåìÉ=íç= éçëÉ=ãÉÇáìãJíÉêã=ÅÜ~ääÉåÖÉëK==qÜ~í=áë=~ÖÖê~î~íÉÇ=Äó=íÜÉ=êáëâ=çÑ=Äê~áåJÇê~áå=~ë=ã~åó= ïÉääJÉÇìÅ~íÉÇ=éÉçéäÉ=çÑ=íÜÉ=ãáÇÇäÉ=Åä~ëë=ÅçåëáÇÉê=äÉ~îáåÖ=íÜÉ=ÅçìåíêóK=== = ^k`=é~êíó=ÇáëÅáéäáåÉ=íÜêÉ~íÉåÉÇ=Äó=íÜÉ=óçìíÜ=äÉ~ÖìÉK=qÜÉ=ê~ÇáÅ~ä=äÉ~ÇÉê=çÑ=^k`Ûë= óçìíÜ=äÉ~ÖìÉI=gìäáìë=j~äÉã~I=Ü~ë=Ñçê=ëçãÉ=íáãÉ=ìåëÉííäÉÇ=ÑçêÉáÖå=áåîÉëíçêë=ïáíÜ= íÜêÉ~íë=íç=å~íáçå~äáëÉ=ãáåÉë=~åÇ=ä~åÇK=oÉÅÉåíäóI=gìäáìë=j~äÉã~=ëíÉééÉÇ=ìé= ê~ÇáÅ~äáëãI=áåÅäìÇáåÖ=~=îáëáí=íç=wáãÄ~ÄïÉ=éê~áëáåÖ=jìÖ~ÄÉÛë=ÅçåíêçîÉêëá~ä=~åÇ= îáçäÉåí=ä~åÇ=êÉÑçêãK=eÉ=Ü~ë=~äëç=ÇÉÑáÉÇ=~=Åçìêí=çêÇÉê=éêÉîÉåíáåÖ=íÜÉ=ëáåÖáåÖ=çÑ=~å=çäÇ= 2
  3. 3. SEB Merchant Banking Country Risk Analysis April, 2010 ~åíáJ~é~êíÜÉáÇ=êÉëáëí~åÅÉ=ëçåÖ=““pÜççí=íÜÉ=_çÉêÒI=ÑìÉääáåÖ=ê~Åá~ä=íÉåëáçåëK==jê=j~äÉã~I= Ü~ë=ìåíáä=êÉÅÉåíäó=ÄÉÉå=~å=áãéçêí~åí=~ääó=çÑ=éêÉëáÇÉåí=wìã~=ÜÉäéáåÖ=Üáã=íç=ãçÄáäáëÉ= ëìééçêí=áå=íÜÉ=äçåÖ=éçïÉê=ëíêìÖÖäÉ=ÄÉíïÉÉå=Üáã=~åÇ=ÑçêãÉê=éêÉëáÇÉåí=qÜ~Äç=jÄÉâáK= eçïÉîÉêI=wìã~=êÉÅÉåíäó=ï~êåÉÇ=íÜÉ=óçìíÜ=äÉ~ÇÉê=íÜ~í=êÉÅÉåí=ÅçåÇìÅíë=~åÇ= ëí~íÉãÉåíë=Ü~Ç=ÄÉÉå=““íçí~ääó=~äáÉå=íç=íÜÉ=ÅìäíìêÉ=çÑ=íÜÉ=^k`Ò=~åÇ=íÜ~í=Üáë= áåÇáëÅáéäáåÉ=ïçìäÇ=åçí=ÄÉ=íçäÉê~íÉÇK=qÜÉ=êÉÅÉåí=ãìêÇÉê=çÑ=bìÖÉåÉ=qÉêêÉÛ_ä~åÅÜÉI=~= ïÜáíÉ=ëìéêÉã~Åáëí=äÉ~ÇÉêI=Ü~ë=~äëç=ê~áëÉÇ=ÅçåÅÉêåë=~Äçìí=îáçäÉåí=ÅêáãÉë=áå=êìê~ä=~êÉ~ë= ~åÇ=ê~Åá~ä=íÉåëáçåëK=aáîáëáçåë=ïáíÜáå=íÜÉ=^k`=~êÉ=ÇÉÉéK=oáî~äêó=ÅçìäÇ=áåÅêÉ~ëÉ=áå=íÜÉ= êìåJìé=íç=áíë=èìáåèÉååá~ä=ÅçåÖêÉëë=áå=OMNOK=kÉñí=ÉäÉÅíáçåë=~êÉ=ëÅÜÉÇìäÉÇ=Ñçê=OMNQK== = JJJJ= = pçìíÜ=^ÑêáÅ~=áë=êÉÅçîÉêáåÖ=Ñêçã=~=êÉÅÉëëáçå=Ó=íÜÉ=ÇÉÉéÉëí=ëáåÅÉ=íÜÉ=Ñ~ää=çÑ=~é~êíÜÉáÇ= Äìí=äÉëë=ëÉîÉêÉI=íÜçìÖÜI=íÜ~å=áå=ã~åó=éÉÉêëK=qÜÉ=êÉÅÉëëáçå=Ü~ë=éìí=éêÉëëìêÉ=çå=íÜÉ= ÄìÇÖÉí=éìëÜáåÖ=ìé=íÜÉ=éìÄäáÅ=ÇÉÄí=äÉîÉä=íç=QM=B=çÑ=damK=få=Åçåíê~ëí=íç=ëçãÉ=éêÉJ ÉäÉÅíáçå=ÑÉ~êëI=íÜÉ=wìã~=éêÉëáÇÉåÅó=ëáåÅÉ=j~ó=OMMV=Ü~ë=ëç=Ñ~ê=âÉéí=ÉÅçåçãáÅ=éçäáÅáÉë= Äêç~Çäó=áåí~ÅíI=áåÅäìÇáåÖ=ÑáëÅ~ä=éêìÇÉåÅÉ=~åÇ=íÜÉ=áåÑä~íáçå=í~êÖÉíK=eçïÉîÉêI=áå=îáÉï= çÑ=íÜÉ=ëçÅáçÉÅçåçãáÅ=éêÉëëìêÉI=íÜÉ=~ìíÜçêáíáÉë=Ñ~ÅÉ=~=ÇÉäáÅ~íÉ=í~ëâ=çÑ=Ä~ä~åÅáåÖ=ÑáëÅ~ä= éêìÇÉåÅÉ=~Ö~áåëí=ëçÅá~ä=~åÇ=éçäáíáÅ~ä=ÇÉã~åÇëK=^=ïÉ~âÉåáåÖ=çÑ=íÜÉ=~ìíÜçêáíáÉëÛ= ÅçããáíãÉåí=íç=éêìÇÉåí=ÉÅçåçãáÅ=éçäáÅáÉë=ïçìäÇ=êáëâ=ê~íáåÖ=ÇçïåÖê~ÇÉë=~åÇ=ÉêçÇÉÇ= áåîÉëíçê=ÅçåÑáÇÉåÅÉK==qÜ~í=ÅçìäÇ=ÅçãéäáÅ~íÉ=íÜÉ=Ñáå~åÅáåÖ=çÑ=íÜÉ=ÅçìåíêóÛë=éÉêëáëíÉåí= ÉñíÉêå~ä=ÅìêêÉåí=~ÅÅçìåí=ÇÉÑáÅáíK=få=~ÇÇáíáçåI=éçäáíáÅ~ä=íÉåëáçåë=ÅçìäÇ=áåÅêÉ~ëÉ=~ÜÉ~Ç= çÑ=íÜÉ=^k`=`çåÖêÉëë=áå=OMNO=~åÇ=íÜÉ=OMNQ=ÉäÉÅíáçåë=~ë=~=êÉëìäí=çÑ=éçäáíáÅ~ä=êáî~äêó= ïáíÜáå=íÜÉ=êìäáåÖ=^k`K==qÜÉëÉ=êáëâë=~êÉ=ãáíáÖ~íÉÇI=íÜçìÖÜI=Äó=ÅçåíáåìÉÇ=ÖççÇ=íê~ÅâJ êÉÅçêÇ=áåÅäìÇáåÖ=çÑ=íÜÉ=åÉï=~Çãáåáëíê~íáçåK== = = How to read the chart? Resilience hÉó=ÑáÖìêÉë OMNN Moving out from the center 13 11 reduces risk. mçéìä~íáçå=EãáääáçåëF RN 9 7 5 damLÅ~éáí~=EAF TNRQ Macro balance 3 Liquidity 1 dam=EÅÜ~åÖÉF PKVB -1 fåÑä~íáçå= RB `ìêêK^ÅÅK=Ä~ä~åÅÉLdam JRKQB Absence of event Information risk oÉëÉêîÉëLáãéçêíë=EãçåíÜëF R _ìÇÖÉí=Ä~ä~åÅÉLdam JRKSB South Africa Average EM dçîÉêåãÉåí=ÇÉÄíLdam QNB bñíÉêå~ä=ê~íáåÖëW= mÉÉêëW dê~éÜW=qÜÉ=éÉåí~Öçå=ëÜçïë=pçìíÜ=^ÑêáÅ~Dë=êáëâ= bñíÉêå~ä=ê~íáåÖëW= Graph: The pentagon shows Turkey's risk worse cáíÅÜW=___HI=åÉÖK _ê~òáä= éêçÑáäÉ=ïÜÉêÉ=áí=ëÅçêÉë=ÄÉííÉê=íÜ~å=~îÉê~ÖÉ=Ñçê=~ää= cáíÅÜW===__JLéçë than average in all respects including to its jççÇóDëW=_~~NI=éçëK fåÇá~= ÉãÉêÖáåÖ=ã~êâÉíë=çå=êÉëáäáÉåÅÉ=~åÇ=áåÑçêã~íáçå= jççÇóDëW=_~P= traditional competitor, Brazil, reflecting weaker pCmW==___HI=åÉÖK oìëëá~= ïÜáäÉ=áí=ëÅçêÉë=ÄÉäçï=~îÉê~ÖÉ=çå=äáèìáÇáíóI=ã~Åêç= pCmW==__JLéçë= liquidity, macro balance and absence of event risk. Ä~ä~åÅÉ=~åÇ=~ÄëÅÉåÅÉ=çÑ=ÉîÉåí=êáëâ=J=ã~áåäó=éçäáíáÅ~ä= êáëâK= = = = = = 3
  4. 4. SEB Merchant Banking Country Risk Analysis April, 2010 Key data: 2005 2006 2007 2008 2009 2010 2011 2012 GDP (bill. US$) OQT OSO OUT OTV OVO PRP PSP PUT GDP/capita (US$) RNPV RPUO RUPM RSOS RUOP SVVT TNRQ TRUS GDP, real (change) RKPB RKSB RKRB PKTB JNKUB OKSB PKVB QKNB Investments/GDP NTB NUB NVB ONB OOB ONB OOB OOB Budget balance/GDP JMKOB MKSB MKVB JNKOB JTKPB JSKSB JRKSB JQKUB Govt debt/GDP PQB POB OSB OQB POB PTB QNB QQB CPI inflation (%) OKNB PKOB SKNB VKVB TKNB RKUB RKRB QKUB Money demand (%) NVB ONB NVB NRB RB NQB NQB NOB Stock prices (%change) OPB QSB PTB JPNB JONB Interest rates TB UB NMB NOB UB TB VB UB Exch. Rate ($) SKQ SKU TKM UKP UKQ TKR UKM UKO Trade/GDP (%) QSB ROB RRB SPB QSB QUB ROB ROB Oil price (Brent)$ ARR ASR ATP AVU ASO AUN AUS AUV Billions US $ Export of goods RSKP SRKV TRKV USKN SSKU UPKN VNKS VUKT Imports of goods RSKS TMKO UNKS VMKS SSKN USKV VRKT NMNKN Other: JU JNM JNR JNS JNO JNN JNR JOM Current account JUKS JNPKU JOMKR JOMKN JNNKO JNQKV JNVKR JOOKR % of GDP JPKRB JRKPB JTKOB JTKOB JPKUB JQKOB JRKQB JRKUB Net FDI RKS JSKN OKU NNKU UKO NRKP NSKN NSKV Loan repayments JOKM JPKU JPKQ JOKU JRKN JRKM JQKV JQKS Net other capital flows NM OU OU NO NP T V NN Balance of payments RKQ QKR SKR NKM RKM OKN NKN NKO Reserves NUKS OPKN OVKS PMKS PRKS PTKT PUKU QMKM Total debt QUKS RVKQ TRKP TNKU URKN UUKT VQKU VOKS o/w short term debt NRKN OMKS OQKM ORKR ONKT OOKR OQKN OOKR Source: OEF (Oxford Economic Forecasting) and SEB estimates Rating history Fitch BBB BBB+ BBB+ BBB+ BBB+ S&P BBB BBB+ BBB+ BBB+ BBB+ Type of government: ANC majority government headed by president Zuma Next elections Parliamentary and presidential elections 2014. Other: Latest PC deal n.a. Recent IMF programs Compensatory and Contingency Financing Facility (CCFF) in December 1993. S to c k m a r k e t E x c h a n g e ra te 35000 12 30000 11 25000 10 USD/ZAR Index 20000 9 15000 8 10000 7 5000 6 02 03 04 05 06 07 08 09 10 07 08 09 10 S o u r c e : R e u te r s E c o W i n C D S , 5 Y e a r , C lo s e , U S D S o u r c e : R e u te r s E c o W i n In t e r e s t r a t e s 550 14 500 13 450 12 400 11 Basis point Percent 350 10 300 9 250 8 200 7 150 6 100 02 03 04 05 06 07 08 09 10 Jan M ar M ay Jul Sep N ov Jan M ar 09 10 P o lic y R a te s , R e p o R a te S o u th A fr ic a B ra zil G o v e r n m e n t B e n c h m a r k s , B id , 1 0 Y e a r , Y ie ld , C lo s e S o u r c e : R e u te r s E c o W i n S o u r c e : R e u te rs E c o W i n = = = = = 4
  5. 5. SEB Merchant Banking Country Risk Analysis April, 2010 = = aáëÅä~áãÉê= = `çåÑáÇÉåíá~äáíó=kçíáÅÉ= = qÜÉ=áåÑçêã~íáçå=áå=íÜáë=ÇçÅìãÉåí=Ü~ë=ÄÉÉå=ÅçãéáäÉÇ=Äó=pb_=jÉêÅÜ~åí=_~åâáåÖI=~=Çáîáëáçå= ïáíÜáå=pâ~åÇáå~îáëâ~=båëâáäÇ~=_~åâÉå=^_=EéìÄäF=E““pb_ÒFK== = léáåáçåë=Åçåí~áåÉÇ=áå=íÜáë=êÉéçêí=êÉéêÉëÉåí=íÜÉ=Ä~åâÛë=éêÉëÉåí=çéáåáçå=çåäó=~åÇ=~êÉ=ëìÄàÉÅí=íç= ÅÜ~åÖÉ=ïáíÜçìí=åçíáÅÉK=^ää=áåÑçêã~íáçå=Åçåí~áåÉÇ=áå=íÜáë=êÉéçêí=Ü~ë=ÄÉÉå=ÅçãéáäÉÇ=áå=ÖççÇ= Ñ~áíÜ=Ñêçã=ëçìêÅÉë=ÄÉäáÉîÉÇ=íç=ÄÉ=êÉäá~ÄäÉK=eçïÉîÉêI=åç=êÉéêÉëÉåí~íáçå=çê=ï~êê~åíóI=ÉñéêÉëëÉÇ= çê=áãéäáÉÇI=áë=ã~ÇÉ=ïáíÜ=êÉëéÉÅí=íç=íÜÉ=ÅçãéäÉíÉåÉëë=çê=~ÅÅìê~Åó=çÑ=áíë=ÅçåíÉåíë=~åÇ=íÜÉ= áåÑçêã~íáçå=áë=åçí=íç=ÄÉ=êÉäáÉÇ=ìéçå=~ë=~ìíÜçêáí~íáîÉK=^åóçåÉ=ÅçåëáÇÉêáåÖ=í~âáåÖ=~Åíáçåë= Ä~ëÉÇ=ìéçå=íÜÉ=ÅçåíÉåí=çÑ=íÜáë=ÇçÅìãÉåí=áë=ìêÖÉÇ=íç=Ä~ëÉ=Üáë=çê=ÜÉê=áåîÉëíãÉåí=ÇÉÅáëáçåë= ìéçå=ëìÅÜ=áåîÉëíáÖ~íáçåë=~ë=ÜÉ=çê=ëÜÉ=ÇÉÉãë=åÉÅÉëë~êóK=qÜáë=ÇçÅìãÉåí=áë=ÄÉáåÖ=éêçîáÇÉÇ=~ë= áåÑçêã~íáçå=çåäóI=~åÇ=åç=ëéÉÅáÑáÅ=~Åíáçåë=~êÉ=ÄÉáåÖ=ëçäáÅáíÉÇ=~ë=~=êÉëìäí=çÑ=áíX=íç=íÜÉ=ÉñíÉåí= éÉêãáííÉÇ=Äó=ä~ïI=åç=äá~Äáäáíó=ïÜ~íëçÉîÉê=áë=~ÅÅÉéíÉÇ=Ñçê=~åó=ÇáêÉÅí=çê=ÅçåëÉèìÉåíá~ä=äçëë= ~êáëáåÖ=Ñêçã=ìëÉ=çÑ=íÜáë=ÇçÅìãÉåí=çê=áíë=ÅçåíÉåíëK= == pb_=áë=~=éìÄäáÅ=Åçãé~åó=áåÅçêéçê~íÉÇ=áå=píçÅâÜçäãI=pïÉÇÉåI=ïáíÜ=äáãáíÉÇ=äá~ÄáäáíóK=fí=áë=~== é~êíáÅáé~åí=~í=ã~àçê=kçêÇáÅ=~åÇ=çíÜÉê=bìêçéÉ~å=oÉÖìä~íÉÇ=j~êâÉíë=~åÇ=jìäíáä~íÉê~ä=qê~ÇáåÖ= c~ÅáäáíáÉë=E~ë=ïÉää=~ë=ëçãÉ=åçåJbìêçéÉ~å=Éèìáî~äÉåí=ã~êâÉíëF=Ñçê=íê~ÇáåÖ=áå=Ñáå~åÅá~ä= áåëíêìãÉåíëI=ëìÅÜ=~ë=ã~êâÉíë=çéÉê~íÉÇ=Äó=k^pa^n=ljuI=kvpb=bìêçåÉñíI=içåÇçå=píçÅâ= bñÅÜ~åÖÉI=aÉìíëÅÜÉ=_ êëÉI=pïáëë=bñÅÜ~åÖÉëI=qìêèìçáëÉ=~åÇ=`ÜáJuK=pb_=áë=~ìíÜçêáòÉÇ=~åÇ= êÉÖìä~íÉÇ=Äó=cáå~åëáåëéÉâíáçåÉå=áå=pïÉÇÉåX=áí=áë=~ìíÜçêáòÉÇ=~åÇ=ëìÄàÉÅí=íç=äáãáíÉÇ=êÉÖìä~íáçå= Äó=íÜÉ=cáå~åÅá~ä=pÉêîáÅÉë=^ìíÜçêáíó=Ñçê=íÜÉ=ÅçåÇìÅí=çÑ=ÇÉëáÖå~íÉÇ=áåîÉëíãÉåí=ÄìëáåÉëë=áå=íÜÉ= rhI=~åÇ=áë=ëìÄàÉÅí=íç=íÜÉ=éêçîáëáçåë=çÑ=êÉäÉî~åí=êÉÖìä~íçêë=áå=~ää=çíÜÉê=àìêáëÇáÅíáçåë=ïÜÉêÉ=pb_= ÅçåÇìÅíë=çéÉê~íáçåëK== = pb_=jÉêÅÜ~åí=_~åâáåÖK=^ää=êáÖÜíë=êÉëÉêîÉÇK= = = = 5

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