THE sudden drop in the value of the rand should be seen as a strong negative comment on the management of the country, says the Cape Chamber of Commerce and Industry.

"It is clear that the world has not been impressed by the instability in industrial relations and some of the recent decisions on matters such as electricity and toll roads as well as the scandals that have come to light," said Viola Manuel, Executive Director of the Cape Chamber of Commerce. 

"The tragedy is that this comes at a time when the African continent is poised for years of growth driven by a boom in natural resources, particularly oil and gas. South Africa, as the leading economy on the continent, should be reaping the benefits of this economic upsurge."

The sudden depreciation of the rand would create many problems for business. Some exporting industries would benefit but others which rely on imports would be hurt.

"In the Western Cape the clothing industry will have to pay more for imported textiles and, as 80 per cent of the fabric used by local manufacturers is imported, the industry could be hurt. On top of that there is a 22 per cent duty on imported fabrics. This adds up to the threat to jobs," said Manuel. 

The new situation required a review of a whole range of decisions by Government. An example was the planned nuclear power stations which became 13 per cent more expensive this month as the value of the rand plunged. It should also rule out the purchase of unnecessary luxury aircraft for our VIPs.

Statement issued by Bronwen Kausch, Chief Operating Officer, Cape Chamber of Commerce and Industry, May 31 2013

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