Floris Slabbert on Die Groot Ontbyt about investing for growth amid the uncertainties about Brexit and potential positive change for South Africa and investors.
What are the latest developments worldwide following Brexit?
There are now many questions around Britain’s future leadership and the announcement has left a lot of uncertainty worldwide. We trust that Brexit can still bring about positive change for South Africa in terms of its negotiations with the European Union and Britain directly. For example, South Africa was ranked the third best tourist destination by Britain and we are hopeful that this relationship will lead to better economic growth for South Africa due to growing tourism numbers from the UK.
Read our most recent Brexit updates.
The biggest concerns for investors
Investors will always worry about uncertainty and precariousness in the market and amid these concerns it is important for investors to stand firm in their investment choices, speak to an accredited financial advisor, and make sure you have enough diversification in your investment portfolio. The benefit is that when markets start fluctuating, there will be sure winners. For example, AngloGold Ashanti’s share price climbed by 20%, all within one hour following the Brexit announcement. Experts also predict that the gold price, currently trading at $1350 per fine ounce, will rise to $1400.
If you were lucky enough to have a crystal ball, could Brexit have made you rich?
As great as that would be, chances are most people did not anticipate the results. Many economies worldwide were blindsided by this announcement and media has made it clear that no one had all the information. Investors were not informed enough regarding Brexit and now many suffer the consequences.
What does this mean in terms of growth?
Growth in South Africa remains at less than 1% and in order to improve this growth rate, South Africa must focus on tourism for job creation, and strengthening the revenue and growth from commodities. The Reserve Bank has mentioned that they will be looking at adjusting interest rates and the next announcement will be made in three weeks.
Tax season has opened- what should investors do?
Tom Monyane, SARS commissioner, collected a record R1 0697 trillion in the last tax season and are aiming for R1 175 trillion this tax season. This will be very positive for credit agencies and they will naturally look at investors already paying heavily towards tax. Therefore, ensure you are choosing tax savvy products and make sure you consult with an accredited financial advisor to give you guidance.
What happened in the markets?
The rand traded at R14.56 against the dollar, which is R1 stronger than the same time last week. Provided the employment rate picks up or at least stagnates, this type of strengthening in the rand should continue.