{"id":153707,"date":"2025-08-07T10:53:49","date_gmt":"2025-08-07T10:53:49","guid":{"rendered":"https:\/\/www.premium-partners.net\/?p=153707"},"modified":"2025-08-08T07:09:12","modified_gmt":"2025-08-08T07:09:12","slug":"my-take-on-the-rand-and-south-africas-future-rayhaan-surve","status":"publish","type":"post","link":"https:\/\/www.premium-partners.net\/fr\/builder\/my-take-on-the-rand-and-south-africas-future-rayhaan-surve\/","title":{"rendered":"My take on the rand and South Africa’s future – Rayhaan Surv\u00e9"},"content":{"rendered":"

This post<\/a> was originally published on this site<\/a><\/p>

<\/p>\n

On Thursday, 24 July, an executive asked me whether they should hedge the Rand below R18 to the dollar. This was my short response:<\/p>\n

Hi XXX, <\/span><\/em><\/p>\n

My thoughts are that USD\/ZAR is at peak for the year and we will see weakening from here [due to] USA tariff effects plus latest policy on ANC leaders. Based on that, I think it\u2019s worth us hedging against a weaker rand over next 6-12 months. Speculative but I don\u2019t see a reason for current level beyond a weaker dollar. <\/span><\/em><\/p>\n

My best,<\/em><\/p>\n

The above is months of news packed into three sentences that reflect more than just the exchange rate.<\/p>\n

So let\u2019s unpack. <\/p>\n

South Africa’s political scene<\/strong><\/p>\n

The first cracks in the Government of National Unity (GNU) emerged at the beginning of the year, as tensions within the parties escalated while attempting to agree on the budget. <\/span><\/p>\n

The GNU is South Africa’s first multi-party alliance, created in response to the African National Congress (ANC) losing its majority in 2024. The GNU is still primarily made up of the ANC and its main opposition party, the Democratic Alliance (DA).<\/p>\n

Amidst the disagreements over the budget, the DA showed its colours by threatening to prevent budget approval unless it received concessions on the party’s other agenda items. The ANC, in turn, showed the public that they are willing to work with parties outside of the GNU, namely the uMkhonto weSizwe (MK) and Economic Freedom Fighters (EFF), to achieve the ANC’s ambitions. The Rand did not appreciate either of these plays.<\/p>\n

Then we had the unauthorised travel by former Deputy Minister Andrew Whitfield, who embarked on a state visit knowingly against the President’s instructions. To Mr President, an open-and-shut case which resulted in immediate termination in July 2025. The DA was outraged. <\/span><\/p>\n

Then, the Minister of Police, Senzo Mchunu, was implicated in a corruption scandal involving the most dangerous gangs in South Africa. The president took his time to come to a decisive action, and only a week later, suspended the former minister pending investigation. The DA was once again outraged, claiming double standards and demanding the immediate termination of Mchunu. Choosing not to immediately suspend Mchunu was really shortsighted by the president, but the suspension has been the right call. South Africa has a robust judicial system, and we must maintain innocent until proven guilty, even when it involves one of the biggest scandals of the year.<\/p>\n

Sidebar: I wish I could say it was the biggest scandal of the year, but it feels like we\u2019re in a telenovela at this point.<\/em><\/p>\n

Political tensions and police corruption of the highest order are not exactly what maintain a strong credibility for the nation. <\/p>\n

The economics<\/strong><\/p>\n

In the first quarter of the year, GDP growth was 0.1%. A figure that would have been negative (-0.3%) if it were not for good rains that boosted our agricultural sector. Bless the rains down in Africa.<\/p>\n

Unemployment in the first quarter went back up to 33%. For the youth (15-34) unemployment was even worse as it shot up to 46%. We have a stagnant economy, and nearly half of our youth are unemployed. Let that sink in.<\/p>\n

Headline inflation was 5.6% in July, and food took the lead.<\/p>\n

There\u2019s pretty much nothing that the South African Reserve Bank can do at the moment with glass fiscal levers ready to break. What we need right now is a huge step up on institutional credibility and private sector mobilisation. Trying to decide which is worse between the political scene and the economic data is a tough choice<\/p>\n

Why did we see a USD\/ZAR below R18?<\/strong><\/p>\n

As with all data, correlation is much easier to show than causation. I speculate that the chaos in the US is worse than that in South Africa. Global investors and markets have not appreciated President Trump\u2019s surprises, even if they are not so surprising.<\/p>\n

If we track a few other currencies against the the rand since the beginning of the year, we can suppose some of the reasoning through correlation. <\/span><\/p>\n

The dollar and the rand both weakened, but the dollar decided to step up the pace while running backwards, and now the rand is trying to catch up. It looks like the rand is going to be sprinting for the last half of the year. But, for now, we\u2019re still behind\/ahead? <\/p>\n

Tariffs<\/strong><\/p>\n

South Africa is most certainly in the crosshairs, and President Donald Trump\u2019s magazine seems bottomless.<\/p>\n

The outlook<\/strong><\/p>\n

As the rand weakens, we have some form of revolution due to political instability and unemployment, chaos ensues, and South Africa finally resets. If we held all things constant, I would say that this is quite likely, but given how tumultuous this year has been, I doubt that this would be the case. I am also much more hopeful that things will improve. Maybe naively so. <\/span><\/p>\n

Here is a more realistic view of the year forward:<\/p>\n

I do believe the rand is on a path to weaken for the rest of the year. There is not much indication domestically that we will have anything substantial to shift that trajectory.<\/p>\n

In the best-case scenario, President Trump lifts the tariffs on South Africa, and we receive a ton of foreign investment to boost the rand and create employment. I can say there is a non-zero chance of this happening. <\/p>\n

What should we do?<\/strong><\/p>\n

I\u2019m not going to try to solve the dilemmas of our nation in one final section, but here are a few thoughts:<\/p>\n

    \n
  1. South Africa needs to be reunited. We\u2019re a nation that works best and punches so far above our weight when we\u2019re together. GNU, EFF, MK, and all the others, please cut the nonsense and put the people first.<\/li>\n
  2. President Trump loves a deal. Give him one. At the same time, the ones that have fared best are those that manage to build alliances amidst the chaos. Divide and conquer works in the 21st century, too, and it\u2019s what President Trump wants.<\/li>\n
  3. Finally, kill the corruption tumour. It runs rampant everywhere regardless of colour. I know it\u2019s much easier said than done, but we seem to be at the height of both corruption and publicly exposing it. Let\u2019s push through the latter and hope the chemo is strong enough. <\/li>\n<\/ol>\n

    Final word<\/strong><\/p>\n

    South Africa is weathering a Category 5 hurricane despite our lack of natural disasters. Nevertheless, we will get through it, like we always do. We have everything in our beautiful country, and now we just need our leaders to unite us on our way forward.<\/p>\n

    Rayhaan Surv\u00e9 is the deputy chairman of Sekunjalo.<\/figcaption><\/figure>\n

    Rayhaan Surv\u00e9 is the deputy chairman of Sekunjalo<\/em>.<\/p>\n

    Rewritten for Business Report from the Mzansi Market Memo Sunday Special Edition<\/em><\/p>\n

    BUSINESS REPORT<\/strong><\/p>","protected":false},"excerpt":{"rendered":"

    On Thursday, 24 July, an executive asked me whether they should hedge the Rand below R18 to the dollar. This was my short response:Hi XXX, My thoughts are that USD\/ZAR is at peak for the year and we will see weakening from here [due to] USA tariff effects plus latest policy on ANC leaders. Based on that, I think it\u2019s worth us hedging against a weaker rand over next 6-12 months. Speculative but I don\u2019t see a reason for current level beyond a weaker dollar. My best,The above is months of news packed into three sentences that reflect more than just the exchange rate.So let\u2019s unpack.\u00a0South Africa’s political sceneThe first cracks in the Government of National Unity (GNU) emerged at the beginning of the year, as tensions within the parties escalated while attempting to agree on the budget. The GNU is South Africa’s first multi-party alliance, created in response to the African National Congress (ANC) losing its majority in 2024. The GNU is still primarily made up of the ANC and its main opposition party, the Democratic Alliance (DA).Amidst the disagreements over the budget, the DA showed its colours by threatening to prevent budget approval unless it received concessions on the party’s other agenda items. The ANC, in turn, showed the public that they are willing to work with parties outside of the GNU, namely the uMkhonto weSizwe (MK) and Economic Freedom Fighters (EFF), to achieve the ANC’s ambitions. The Rand did not appreciate either of these plays.Then we had the unauthorised travel by former Deputy Minister Andrew Whitfield, who embarked on a state visit knowingly against the President’s instructions. To Mr President, an open-and-shut case which resulted in immediate termination in July 2025. The DA was outraged. Then, the Minister of Police, Senzo Mchunu, was implicated in a corruption scandal involving the most dangerous gangs in South Africa. The president took his time to come to a decisive action, and only a week later, suspended the former minister pending investigation. The DA was once again outraged, claiming double standards and demanding the immediate termination of Mchunu. Choosing not to immediately suspend Mchunu was really shortsighted by the president, but the suspension has been the right call. South Africa has a robust judicial system, and we must maintain innocent until proven guilty, even when it involves one of the biggest scandals of the year.Sidebar: I wish I could say it was the biggest scandal of the year, but it feels like we\u2019re in a telenovela at this point.Political tensions and police corruption of the highest order are not exactly what maintain a strong credibility for the nation.\u00a0The economicsIn the first quarter of the year, GDP growth was 0.1%. A figure that would have been negative (-0.3%) if it were not for good rains that boosted our agricultural sector. Bless the rains down in Africa.Unemployment in the first quarter went back up to 33%. For the youth (15-34) unemployment was even worse as it shot up to 46%.\u00a0We have a stagnant economy, and nearly half of our youth are unemployed.\u00a0Let that sink in.Headline inflation was 5.6% in July, and food took the lead.There\u2019s pretty much nothing that the South African Reserve Bank can do at the moment with glass fiscal levers ready to break. What we need right now is a huge step up on institutional credibility and private sector mobilisation. Trying to decide which is worse between the political scene and the economic data is a tough choiceWhy did we see a USD\/ZAR below R18?As with all data, correlation is much easier to show than causation. I speculate that the chaos in the US is worse than that in South Africa. Global investors and markets have not appreciated President Trump\u2019s surprises, even if they are not so surprising.If we track a few other currencies against the the rand since the beginning of the year, we can suppose some of the reasoning through correlation. The dollar and the rand both weakened, but the dollar decided to step up the pace while running backwards, and now the rand is trying to catch up. It looks like the rand is going to be sprinting for the last half of the year. But, for now, we\u2019re still behind\/ahead?\u00a0TariffsSouth Africa is most certainly in the crosshairs, and President Donald Trump\u2019s magazine seems bottomless.The outlookAs the rand weakens, we have some form of revolution due to political instability and unemployment, chaos ensues, and South Africa finally resets. If we held all things constant, I would say that this is quite likely, but given how tumultuous this year has been, I doubt that this would be the case. I am also much more hopeful that things will improve. Maybe naively so. Here is a more realistic view of the year forward:I do believe the rand is on a path to weaken for the rest of the year. There is not much indication domestically that we will have anything substantial to shift that trajectory.In the best-case scenario, President Trump lifts the tariffs on South Africa, and we receive a ton of foreign investment to boost the rand and create employment. I can say there is a non-zero chance of this happening.\u00a0What should we do?I\u2019m not going to try to solve the dilemmas of our nation in one final section, but here are a few thoughts:South Africa needs to be reunited. We\u2019re a nation that works best and punches so far above our weight when we\u2019re together. GNU, EFF, MK, and all the others, please cut the nonsense and put the people first.President Trump loves a deal. Give him one. At the same time, the ones that have fared best are those that manage to build alliances amidst the chaos. Divide and conquer works in the 21st century, too, and it\u2019s what President Trump wants.Finally, kill the corruption tumour. It runs rampant everywhere regardless of colour. I know it\u2019s much easier said than done, but we seem to be at the height of both corruption and publicly exposing it. Let\u2019s push through the latter and hope the chemo is strong enough.\u00a0Final wordSouth Africa is weathering a Category 5 hurricane despite our lack of natural disasters. Nevertheless, we will get through it, like we always do. We have everything in our beautiful country, and now we just need our leaders to unite us on our way forward.Rayhaan Surv\u00e9\u00a0is the\u00a0deputy chairman of Sekunjalo.Rayhaan Surv\u00e9\u00a0is the\u00a0deputy chairman of Sekunjalo.Rewritten for Business Report from the Mzansi Market Memo Sunday Special EditionBUSINESS REPORT<\/p>","protected":false},"author":1,"featured_media":12899,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-153707","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-builder"],"_links":{"self":[{"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/posts\/153707","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/comments?post=153707"}],"version-history":[{"count":2,"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/posts\/153707\/revisions"}],"predecessor-version":[{"id":153710,"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/posts\/153707\/revisions\/153710"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/media\/12899"}],"wp:attachment":[{"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/media?parent=153707"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/categories?post=153707"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.premium-partners.net\/fr\/wp-json\/wp\/v2\/tags?post=153707"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}