Business news headlines: Tumisang Ndlovu – Moneyweb

Analysts question where Eskom funding announced in the SONA will come from.

HANNA BARRY: Good evening and welcome to the SAfm Market Update with Moneyweb. My name is Hanna Barry, in for Siki Mgabadeli this evening.
   We would just like to apologise for the lack of broadcast yesterday evening. We had some technical difficulties with Telkom lines, unfortunately. But if you would like to read or listen to the interviews that were done on that show, you can hop onto the Moneyweb site. We did interviews with Woolworths, Gold Fields and more.
   Coming up tonight, we are chatting about the Sandwich Generation – people who are sandwiched between their parents and their own children and find themselves having to provide financial support to both sides. You may be one of these people, so why not call us on 011-731-8502 and tell us about your experience. Craig Turton, a director at Chartered Risk Solutions and a certified financial planner will be joining us and ready to take any questions you may have.
   Our market watcher this evening is Wayne McCurrie of Momentum Wealth, but first Tumisang Ndlovu has your business news headlines.

TUMISANG NDLOVU: Thanks, Hanna. Good evening.
   Concern has been raised following President Jacob Zuma’s announcement of government’s plan to help rescue Eskom from its power supply and financial woes. During his 2015 State of the Nation Address last night, which began on a chaotic note, President Jacob Zuma announced that Eskom will receive around R23bn in the next fiscal year. He also announced alternative sources of energy going forward, which include gas, petroleum and nuclear. Analysts have however raised questions over where the money will come from. Meanwhile Eskom has announced Stage 2 load-shedding tomorrow morning.
   Still on struggling parastatals, the President also announced plans to discontinue routes that are financially not viable for SAA. This after government granted the parastatal a R6.5bn guarantee. SAA’s current debt guarantees now stand at R40.5bn. Economist Dawie Roodt shares his views:

DAWIE ROODT: If you calculate how much money we, the taxpayers, have given South African Airways the past couple of years by way of subsidie, this is in the region of about R20bn. My suspician is in this case that they are going to borrow the money from the bank, the capital markets or wherever – and eventually that money will be paid out by us, the taxpayers.

TUMISANG NDLOVU: Zuma further made pronoincvements on efforts to boost the SME sector, the mining industry and promised more job creation as well as accelerating economic development.
   And analysts have started making predictions on the last fuel price adjustement which the Energy Department is only expected to announce in two weeks’ time, some expecting an increase after two sizeable consecutive decreases this year as a result of the international oil price being low and a slightly stronger rand at the time. The rand has since dropped, reaching its lowest level since 2002 this week, while the price of Brent crude oil continues to gain strength having reached over $60/barrel mark for the first time this year following months of decline.
   On that note, financial indicators this hour: the rand is at R11.67/dollar, R17.95/pound and R13.32/euro. Gold is trading at $1 233.55/oz, platinum at $1 212.50/oz and Brent crude oil at $81.34/barrel.

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