Latest news with #Afrimat
IOL News
25-06-2025
- Business
- IOL News
Construction activity declines in the first quarter due to high rainfall in four provinces
The Afrimat Construction Index for Q1 2025 indicates a 2.6% decline in construction activity, attributed to high interest rates and adverse weather conditions, highlighting the ongoing challenges faced by South Africa's construction sector. Image: Leon Sadiki/Bloomberg Construction industry activity in the first three declined due to high rainfall and no meaningful impact from the marginal drop in the prime overdraft rate since September, according to findings of the first quarter, Afrimat Construction Index (ACI). The ACI is an index of the level of activity within the building and construction sectors, compiled by economist Dr Roelof Botha and commissioned by the mid-tier mining company that produces and supplies construction materials, iron ore, anthracite, phosphate, and industrial minerals, Afrimat. The year-on–year comparison with the first quarter of last year in the ACI showed a decline of 2.6%. Dr Botha said he believes the reading is an accurate reflection of the government's lack of willingness to spend on economic assets. 'Following a sharp drop during the pandemic, the ACI recovered swiftly to within a whisker of its pre-COVID level, but the recovery was then stymied by inadequate fiscal support for infrastructure expansion and the hangover from the state capture era, where the effectiveness of key State-owned enterprises and public sector agencies was eroded. Over two years, these problems have been exacerbated by the South African Reserve Bank's restrictive monetary policy,' said Dr Botha. He said the sector had been hamstrung ever since the high interest rates started to bite into the pockets of prospective home-owners and property developers, as indicated by the decline in the real value of building plans passed by the metros and larger municipalities. These had declined in Gauteng, Western Cape and KwaZulu-Natal (KZN) over three years. He said in an interview interest rates were well above pre-Covid levels, a time when the government was already being criticized for an excessively stringent monetary policy. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ The value of construction activity by the public sector has fallen markedly since 2015, while the value of construction by the private sector has increased on slighltly since them. Image: Afrimat 'Construction is the most labour intensive sector in the economy, and the restrictive monetary policy has not only prevented this sector from recovering from the pandemic but has also contributed to the sector entering a deep recession,' he said. Above-average rainfall in some provinces in the first quarter also severely impacted construction activity. KZN had a noticeable increase over its historical average, Gauteng experienced above-average rainfall, particularly in January, while the North West saw a notable increase compared to its historical average. The high rainfall was a major factor to the decline of some of the indicators in the ACI, with only two indicators showing growth. Employment in construction was up 2.1% year-on-year and hardware retail trade up 0.2% on the same basis. High rainfall in some provinces and a continuing high interest rate contributed to a decline in construction activity in the first quarter on a year-on-year comparison basis. Image: Afrimat Dr Botha said the value of annual construction activity by state-owned enterprises had dropped by 61% since 2015, while the percentage decline for all government departments including municipalities for the same period came to 45%. He said the roadmap for higher and sustained economic growth in South Africa recently published by the World Bank at the request of the government, provided an opportunity to eliminate some of the impediments to a revival of the construction sector, especially in enhancing decision-making in relevant public sector agencies. Afrimat CEO Andries van Heerden said they were happy that their experience stood in contrast to the ACI's findings, in that both the group's cement kilns were running, and market demand was significantly stronger than originally anticipated.
Daily Maverick
17-06-2025
- Business
- Daily Maverick
After the Bell: Want a decision from the SA government? Don't hold your breath
There are plenty of cases where the government just takes a long time to make decisions. Even decisions that need to be made by one person can take forever. In some cases, the process is just too technical, with too many steps. And while it can be frustrating, it is also really expensive for our economy. One of the great and terrible certainties about South African life is that you know any kind of government process is just going to take forever. And while it can be frustrating and taxing, in the end it is also hugely expensive for our economy. On Tuesday, 17 June 2025, BusinessLIVE reported on the CEO of Afrimat, who had told shareholders in the annual report that a delay by the Competition Tribunal over its deal with Lafarge SA might have cost the company about R185-million. That's because while the tribunal was considering the case, the equipment, including kilns, fell into disrepair. By the time the tribunal allowed the deal, it was exactly a year since it was first announced. And remember, all the tribunal had to do was consider the recommendations of the Competition Commission — it wasn't as if they were starting the entire case from scratch. Something similar has happened with the Vodacom-Maziv deal, where the two want to work together to roll out fibre. This is something that should greatly benefit our economy. That case took three years before the Competition Tribunal eventually ruled that the merger could not go ahead. And even then, the parties had to wait for months before the final reasons were actually published. Considering how the fibre market has changed in the past three years, this might well have a material impact on whether the deal still has the same value as it did when it was announced. It's easy to pick on the Competition Tribunal. And we should. But there are plenty of other cases where the government just takes a long time to make decisions. In some cases, the process is just too technical, with too many steps. There are also, arguably, too many different forums. For example, Vodacom now has to appeal against the Competition Tribunal ruling in the Competition Appeal Court. It is even possible that if it fails there, it could go to the Constitutional Court. That would mean the whole thing will probably take more than five years. But it is not just our judicial and legal processes that take a long time. Even decisions that need to be made by one person can take forever. Jacob Zuma once took nearly two years just to appoint a new head of the Special Investigating Unit. That was clearly political; he didn't want anyone in the job for reasons that became pretty obvious. But President Cyril Ramaphosa sometimes isn't much better. The head of the National Prosecuting Authority (NPA), Shamila Batohi, has asked him to suspend the head of prosecutions in Joburg, Andrew Chauke. He is accused of a litany of sins, including sabotaging prosecutions during the State Capture era. Her request was made nearly two years ago. And Ramaphosa has still not made a decision. Considering that he has claimed to want to support our independent institutions, and the NPA, what could his motive possibly be? Two weeks ago, Police Minister Senzo Mchunu withdrew an advert for a new head of the Hawks, after Godfrey Lebeya retired. The process to find a new head will now start again, meaning they will be without a boss for four months. At least. And I'll bet you the cost of a double ticket to see the Springboks at Ellis Park that it will take longer than that. There are many other examples. Former Department of Trade, Industry and Competition Minister Ebrahim Patel was accused by the current head of the National Lotteries Commission, Professor Barney Pityana, of delaying the appointment of the agents who formally assign money to groups that are supposed to benefit from it. The current Health Minister, Dr Aaron Motsoaledi, appeared to take forever to publish regulations around the digital nomad visa when he was at Home Affairs. In the end the new minister, Leon Schreiber, had to do it. And was able to claim something for the DA in the process. I think sometimes when there is a long delay we have to ask who is really responsible. In the case of the Competition Tribunal, it is not just that they make decisions businesspeople don't like. It's that the delay is caused because they don't have enough members. As columnist Michael Avery has pointed out, it appears to be seriously understaffed. By the way, they're not the only ones. Mbekezeli Benjamin from Judges Matter once pointed out that the Electoral Court had been without a full complement of staff for a full five years. That's astonishing, no matter how you look at it. And it's only because of the politicians; they are the ones who are ultimately in charge. When there are delays like this, I think we're entitled to ask why. And this is the risk to the politicians. When Ramaphosa can't make up his mind about Andrew Chauke for two years, it looks like he's defending him, even if he's not. When tribunals and courts are left without their full complement of judges and commissioners, it must make them weaker. But sometimes it can be something else. DM
