Die Vine Intervention: 2011 Jordan Cabernet Sauvignon

Food and wine guru Michael Olivier is back on the tasting trail with an impressive Cape red – the 2011 Cabernet Sauvignon from Jordan.
John Fraser is once again joined in the Die Vine Intervention Johannesburg studio by branding expert Jeremy Sampson and by Corlien Morris from Wine Concepts in the Bluebird Centre.

Die Vine Intervention: 2011 Jordan Cabernet Sauvignon

Food and wine guru Michael Olivier is back on the tasting trail with an impressive Cape red – the 2011 Cabernet Sauvignon from Jordan.
John Fraser is once again joined in the Die Vine Intervention Johannesburg studio by branding expert Jeremy Sampson and by Corlien Morris from Wine Concepts in the Bluebird Centre.

Why is Politeness Punished and Rudeness Rewarded?

I get incredibly annoyed when I am on time, or early, for conferences or presentations or media events which start horribly late. The reason? The hosts would rather make a plan to accommodate latecomers than show their appreciation for those of us who also have had to cope with bad traffic and other commitments – but did manage to get there on time. I was recently at a News Conference of the Minister of Economic Development which started almost half an hour late. The reason given: they were waiting for a tardy SABC crew which was looking for parking. And I once walked out of an FNB event 20 minutes after the scheduled starting time, as nothing was happening. It wasn’t the bank’s fault, as they were waiting for a very late dti Minister Rob Davies. I am also infuriated by some attempts to cope with this problem – when people give a starting time for an event which is half an hour before the true start, because they think this might enable the latecomers to get there before kick-off. But am I alone in this? What do our experts think?

Company Director Brand Pretorius:

I admire countries, societies, organizations and people that regard punctuality as a core value. Such a commitment to punctuality normally goes hand in hand with a similar commitment to professionalism, respect for all people and excellence. On the other hand, a lack of discipline in this regard tends to be symptomatic of an attitude that is not conducive to productivity, efficiency and respectful behaviour.

Jeff Osborne of Gumtree Auto ZA:

 To say “better late than never” would simply contradict my very sentiments where punctuality is concerned. Perhaps it’s my military background, or my upbringing, but I am obsessed with being on time. I believe it is not only respectful, but also basic good manners to be punctual. I know that with each successive generation, there is continual relaxation of convention and tradition. This is very evident where dress code is concerned, along with dinning etiquette and so on. Perhaps some of this relaxation is practical and sensible.  However, a non-observance of basic good manners is inexcusable and just downright rude. When the bell rings at school, it signals and dictates action. So why has punctuality suddenly become unimportant in business circles? But sadly, it has somehow become normal and acceptable for significant numbers of delegates to be delayed, for a variety of reasons. I see the same in meetings, where people arrive late and then proceed to drift in and out on their cell phones. This is unacceptable in my book. Perhaps the only way to remedy this behaviour is for seniors to start leading by example, to not mislead the juniors. This will set the scene and give bosses the right to insist on acceptable levels of decorum. Yow may call me old fashioned – but hopefully never late.

Journalist and Broadcaster Benedicta Dube:

It’s always amazing how some organisations consider certain media more important than others. The unfortunate part is that the very media that are placed on the pedestal have no respect for the very organisations that roll out the red carpet for them. Not showing up on time shows a lack of respect for the people that invited you – and those who wait up on them show an amazing level of sycophancy.

Chris Gilmour from Barclays Africa:

This is a pet hate of mine – rude and inconsiderate latecomers. Sure, we all have hectic schedules these days but most of us manage to be on time or at worst a few minutes late for meetings. Provided the participants have been given decent advance warning of the date and time of an event, it really shouldn’t be asking too much to expect them to be on time. Meanwhile, if they aren’t going to attend, they should at least have the decency to proffer a decent excuse or reason – either by email or telephonically. Not showing up is incredibly rude – but adding insult to injury by not apologising is, frankly, beyond the pale.

Business Report Editor Ellis Mnyandu:

Latecomers deserve to get no priority as their recognition undermines the time and value of those who make it a priority to be in time.

 

Conclusion:

Better never than late.

 

Tweet of the Day:

Ellen DeGeneres (@TheEllenShow): What do you call a country made up entirely of spotted dogs? A Dalnation

dapper trapper (@dapptrap): to be fair, humans kill more cigarettes than cigarettes kill humans

Nein. (@NeinQuarterly): Somewhere an old man is walking into a bar, looking for the sea.

((Follow us on twitter: @zaconfidential))

 

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SA’s Top Tourism Trends

Gillian Saunders of Grant Thornton today addressed the media on the last 20 years of tourism in ZA.   It’s an industry we will always support, because of its contribution to economic growth, to exports and to job creation.   So we were keen to learn how things are going. Here are some of the highlights from a rather jam-packed presentation: 

  • There has been huge growth in tourism in SA.  There were around 14m international arrivals last year

  • There was 15% growth in arrivals in the Soccer World Cup year 2010

  • China is now one of major countries for tourism to ZA: there was nothing 20 years ago

  • The number of hotels has doubled in the 20 years.  Guest house numbers are up three-fold

  • In the 1st decade from 1994, everyone loved CT.  Durban came on more in the 2nd decade, while Jo’burg has seen steady growth

  • Room Rates have steadily gone up in real terms.  Five star hotels really pushed rates up in 2010.  But hotels are a lot better, on average

  • There has been a 5-fold increase in visitors to National Parks over the 20 years

  • As for conference venues…the number has doubled over the same period

  • Casino numbers also doubled.  And most casinos are much larger than they were.  An important tool for tourism

  • The number of luxury coaches more than doubled

  • The car hire fleet more than doubled

  • As for airlines: 21 international airlines flew to ZA in 1993.   Now it is up to 76 international airlines

  • World heritage sites have grown from zero in 1994 to 8 today

  • Employment in tourism has been growing 4.7 percent on average a year

  • The State’s tourism budget is growing, but is small by international comparison.  2013/14 was R856m

     

Conclusion:

Some significant progress is being made, but this sector needs more focus and more support. Not least in terms of boosting service and standards.   We have been horrified by some of the food we have been served recently at some very expensive hotels in Johannesburg. Personally, we would like to see much more coordination between the wine and tourism industries, and are happy to play a role in this, focusing on quality control.

Tweet of the Day:

Jerm (@mynameisjerm): Difference between a religious doomsdayer and greenie is that is one preaches the end of the world, and the other is a religious doomsdayer

Follow us on twitter: @zaconfidential.com

 

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A Cascade of Economic Gloom

Not a good day so far. Three less than encouraging bits of economic news and a speech from the Central Bank Governor suggesting new interest rate rises.  Stats SA tells us that in April, manufacturing production was down by 1.5% year-on-year. Meanwhile, the RMB-sponsored Business Confidence Index, which is compiled by the Bureau for Economic Research, remains unchanged at 41 points in the second Quarter of 2014 – meaning close to 60% of respondents are unhappy with prevailing business conditions.   And earlier today, the Adcorp Employment Index for May landed, showing job losses of just under 27 000.   Add to this a speech by Governor Gill Marcus warning (according to the brief reports we have seen – our invitation was lost in the post) of further interest rises.   Whether or not the economy is in recession, there is not a lot to crow about. A few comments on sections of the data:

Annabel Bishop of Investec on Business Confidence:

The RMB/BER business confidence index remained at 41 in Q2.14, signalling 59% of respondents (senior executives) found business conditions unsatisfactory. This very poor reading is concomitant with an economy at risk of recession (the Q1.14 reading was also 41). Business confidence gives a good leading indication of the likelihood of expansion or contraction in the economy, and so the impact on private sector employment and fixed investment.   India and China, with populations around a billion each, and imperatives to absorb hundreds of millions into the formal sector’s economic net, have found great success with freeing up their economies and privatization of State assets. SA instead is targeting increased state intervention, custodian ownership and control of the economy, with potential erosion of private sector property rights detailed in the Promotion and Protection of Investment Bill of 2013.

Ettienne Le Roux from RMB on Business Confidence:

Special factors continue to distort the data, and so makes it difficult to distinguish between noise and real underlying trends. Still, there is an element of weakness to the economy that goes beyond such factors. While the impact of electricity shortages, supply disruptions in the platinum sector and their spill-over effects to manufacturing cannot be denied, there is also a more fundamental problem in constrained consumer demand. As such, the RMB/BER BCI remaining unchanged at a low 41 points may well be reflective of the economy already being in a technical recession (defined as two consecutive quarters of negative GDP growth). Yet, for the year as a whole, real GDP should still expand by around 1.5% to 2%. If the services sector, coupled with agriculture and construction more or less maintain their first quarter growth momentum, a return to more normal conditions in the platinum industry would give the economy a kicker in the second half of the year.

Peter Attard Montalto from Nomura on the Governor’s Speech:

Overall we would not interpret recent speeches by the governor and others as dovish but as still hawkish within the context of sensitivity around recent low growth prints. The SARB is clearly having to battle a market that doesn’t totally believe it is in a hiking cycle (you can only be on hold in a hiking cycle for so long). It also has to reassure a domestic constituency that sees such weak growth and needs to be persuaded of the need to hike rates while at the same time promoting a SARB that is still sensitive to the political dynamics of growth. As such, we keep our July hike view (+50bp) but believe it will be very much dependent on upcoming CPI prints. Indeed, the Governor’s speech this morning stated explicitly that the SARB is watching for the dynamics around second-round effects into core inflation. We believe there is a group within the MPC who understands they cannot hold off hiking too long and the upcoming expected very high CPI prints will be an excuse to quash any second-round effect and wage round risks early on. We expect this argument to gain a majority. Downside surprises in those CPI prints, however, would complicate matters yet further. 

Nedbank Economic Unit on the Manufacturing numbers:

Manufacturing production declined by less than expected, with total output falling by 1.5 % y-o-y in April off the high base established in the same month last year caused by a deviation from normal seasonal patterns around the timing of public holidays in 2013. The market expected a drop in output of 5.5 % y-o-y due to weak underlying conditions and base considerations. Manufacturing production rose by 3.5 % on a seasonally adjusted basis over the month but fell by 1.8 % in the three months to April compared with the previous three months.   The main contributors to the annual decline was lower output in the ‘motor vehicles, parts and accessories and other transport equipment’ as well as ‘petroleum, chemical products, rubber and plastics’ industries. According to the Kagiso PMI for May underlying trading conditions not only remained weak but deteriorated further in May. However, the weaker rand and stronger global demand are still expected to lift production and exports in the second half of the year. Growth rates for 2014 may also be enhanced by the low base created in the strike-inflicted second half of 2013. However, considerable downside risks remain given rising production costs, uncertain and insufficient power supply, other infrastructure constraints and the strained relationship with labour. So far there is little evidence of any significant pickup in economic activity early in the second quarter. There is also still no end to the strikes at the platinum mines. This will probably result in another disappointing outcome for GDP in the second quarter. Despite this, with inflation rising and the rand still vulnerable we anticipate mild tightening towards year end. More significant hikes are likely in the second half of 2015 once international interest rates start trending higher.

 Adcorp’s Loane Sharp on the Employment Index:

South African employment remains disheartening, primarily because permanent work continues to decline (by 54,184 during May). Employment in non-permanent work, however, was sharply up. Informal employment grew by 8,591, temporary work grew by 27,250 and agency work grew by 4,555 during the month. Overall, the knock-on effect of declining permanent work and rising non-permanent work resulted in a total loss of 26,934 jobs. Significant job losses were observed in manufacturing (3,000), financial services (5,000) and transport and communications (5,000). Only the public sector created jobs during the month, amounting to 4,000 in government and 4,000 in state-owned enterprises. Among occupations, only professional occupations (professionals and management) created jobs during the month (17,000).

Conclusion:  

More bad economic data and a gloomy Governor. There is a question mark over whether we are now in a recession, but consensus seems pretty solid on the likelihood of future interest rate hikes. The only question seems to be over the timing of this……

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When is it Rude to Favour your Mobile Over the Speaker?

This ZA Confidential will be inspired by my own bad manners. Or not. Quite often at conferences, presentations and speeches I will be seen fiddling with my phone or tablet. Sometimes I am sending out social media messages about the event on twitter or Facebook. On other occasions, the event is failing to inspire, and I find my twitter feed more interesting than the speaker. So what is right and wrong in this era when most of us have hand-held communications devices? Is it rude to tweet? Sometimes conference organisers encourage it.   What do our experts think?

Executive Vice President Africa: Vodafone Global Enterprise, Deon Liebenberg:

In a sense, we’re lucky that the early Wild West days of social media are over and the medium is settling down to a more calm and respectable middle age. Anonymity and outrageous comments are becoming more rare. Twitter is being used in business as a tool for people to build their personal brand. Having an anonymous account would work counter to this – what’s the point of having great insight if you don’t get credit for it?  So given that most people eschew anonymity, I’d say that dinner party rules apply to posting from events. Even if you’ve been fed an inedible rubberised steak, you’d still smile sweetly and thank the host for a great meal.  Similarly, it’s not rude to comment from events unless you’ve explicitly been asked not to, but I’d think very carefully about finding positive points to highlight and avoid open criticism.  After all, your hosts will see the comments and so will others.  A persistently negative outlook might just result in a lack of invites in the future.

Speaker and Writer David Bullard:

There’s nothing worse for a speaker than conference attendees furtively looking under their tables at their SMSs from prospective sexual partners for the night. On the other hand, many speakers are so tedious that it’s either a case of falling asleep and snoring conspicuously or setting up some sexual activity for the evening. Simple message…if the audience is bored with what you are saying then they can and will find alternative entertainment. I always take earplugs with me which I can discreetly put in my ears while I am pretending to record a speech. Secretly I am probably listening to music on my iPhone. If you try this, please remember not to sing along with whatever you have on your iPhone. It’s a dead giveaway.

Alan Knott-Craig of PROJECT ISIZWE:

Personally, tweeting whilst someone is speaking is rude, unless it’s very interesting content. On the other hand it’s rude to waste my time with a boring presentation.

Malcolm MacDonald from Tersos:

I certainly think it is situational. If you are in a meeting to participate, then you should focus and participate.  If you are at a function to hear about something new, then the greatest contribution you can make is getting the (public domain) information to your network as fast and accurately as possible. The rule should be: don’t be disruptive for the sake of the people sitting around you; use your technology discreetly and quietly. A darkened auditorium lit by your iPad screen poses a greater dilemma. That would be disruptive. Maybe organisers should also consider the audience in that respect. Say upfront what you would like the audience to do. I have been at conferences where the organisers propose a hashtag and encourage everyone to communicate as much as they want about the proceedings. The problem is when the organisers are silent on the matter, and create an atmosphere (like a darkened auditorium) that is not conducive to discreet tech use. In that situation it depends on the seating arrangement. If the light from your device can be turned down and not distract the people around you – then go ahead. Otherwise, wait till the lights are turned back up. Mostly I’m asking organisers to set clear guidelines so that everyone knows where they stand: i.e. “I am contravening the guidelines on purpose, so expect someone to attack me”, or “I am following the guidelines so anyone complaining is out of order.” Because I know some of you will tweet anyway – but then at least everyone knows where they stand.

Martyn Davies from Frontier Advisory:

It’s hard to integrate social media with audience attention!  

Mario Pretorius from Telemasters: 

The New Era requires new rules. Or at least new requests and guidelines. Only in church and a movie is one required to be stoic and uncommunicative; the genie is out for the rest. Perhaps tweeting and e-mail while driving is exceeding the limit of good common sense, but for paying patrons, who shall govern their behaviour? The unwritten rule is they behave, not to challenge the speaker in his stride, who is selling snake oil. The reality is that in the absence of a riveting, life-relevant and user-urgent presentation, the competition from a million sources will overwhelm a bored and unappreciative audience. And rightly so. The competent speaker will show the twitter feed live on the screen, will outclass mail catch-ups and knock-out his participants. His statements will be googled for accuracy. He will be challenged and debated by thousands in real time. He will have to up his standards to not waste that most precious of all resources: people’s time.

Duncan McLeod from TechCentral:

I think it really depends on what it is you’re attending. If it’s a formal meeting with a few people where your concentration is demanded (a board meeting, say) then fiddling with your phone is probably a no-no. But at conferences it’s often encouraged and not considered rude at all. In fact, Twitter hashtags have become an important and useful way of encouraging audience engagement. It works well. I think it also depends what profession you’re in. Journalists, for example, are expected to be furiously typing away on their phones and laptops when they’re out and about. I think people should apply simple common sense as to when it’s appropriate or otherwise to be fiddling with their smartphones.

Conclusion:

Some useful advice. My own approach will continue to involve a tablet and a phone on hand, and sometimes even my laptop.   Provide a worthwhile speech and I will listen and tweet about that. Be boring and my head will be bowed, catching up on the far wittier and more entertaining crowd in twitterland. Or researching the next edition of ZA Confidential.

Tweet of the Day:

Mark Twain (@MarkTwainQuote): When I was younger I could remember anything, whether it happened or not.

 

ZA Confidential is a subscription newsletter.   For subscription details or any other communication, please contact:   zaconfidential@gmail.com

2012 Koelfontein Chardonnay

What a pleasure! Award wining food and wine guru Michael Olivier delivers a stunning Cape White for this week’s podcast tasting – the 2012 Chardonnay from Koelfontein in Ceres.

John Fraser is joined on the tasting panel in Johannesburg by Corlien Morris from Wine Concepts in the Bluebird Centre and by branding guru Jeremy Sampson.

Leading Economists Divided on Whether ZA is in Recession

Ever since we were told that the ZA economy shrank by 0.6% in the first quarter of this year, there has been a fear that the current, second quarter will also show negative growth. If it does, we will be in a recession.   It will be a few months before we get the official Q2 figure, so at the moment we cannot be sure about this. But what do expert economists think?   For our first ever poll, ZA Confidential spoke at the end of the week to more than a dozen leading economists to get their views. Most of them responded, and I have tried to accurately capture their views. Here is what they think….

Are we already in a recession?

Yes:

Mike Schussler, economists.co.za

Iraj Abedian., Pan-Africa.

Christo Luus, EcoQuant

Chris Hart, Investment Solutions

Ian Cruickshanks, SAIRR

No:

Peter Attard Montalto from Nomura

Sizwe Nxedlana, FNB

Professor Eltie Links

Roger Baxter, Chamber of Mines

Maybe:

Luke Doig, Credit Guarantee

Dawie Roodt, Efficient Group.

Loane Sharp, Adcorp

Prof Raymond Parsons, NW University.

 

Conclusion:

Well. Quite a range of views. Five of our panel of thirteen believe the recession has landed, while four believe we will escape a recession. Meanwhile, the other four are still not sure. There is still hope that the economy will edge forward this quarter, but even so this is not wildly encouraging, with only four of those polled saying there will be no recession. And even if there is some growth in Q2, it is not going to be very impressive, and is unlikely to help us much to deal with the army of unemployed.

 

Tweets of the Day:

Funny Tweets (@Funny_TweetsQ): Diet ideas: Eat whatever you want, and if anyone tries to lecture you about your weight, eat them too.

Steve Stifler (@SteveStfler): Whoever said laughter is the best medicine clearly never tasted scotch

Steve Stifler (@SteveStfler): I’m really glad we don’t have to hunt our own food anymore…. I don’t even know where sandwiches live.

Steve Stifler (@SteveStfler): Whenever you’re having a bad day just remember there are people who have the names of their exes tattooed on them

Ben Weller (@BenWeller): Imagine being as cool as the people at the supermarket who start eating their food before they’ve bought it

 

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Eskom Advises Wooly Sweaters and Hot Water Bottles

Our new Public Enterprises Minister Lynne Brown was centre stage this morning at a news conference at Eskom, which saw a fresh plea from this crucial service provider for us to use less of its service. Ideas on offer were for customers to dress up for outdoors indoors, and also for using hot water bottles, so we consume less fuel for heating in our homes. Meanwhile, Eskom has a multi-million rand funding shortfall, and says it could be some years before the electricity system is producing all the power that is needed. In an effort to further dampen consumption, Eskom bosses are in new talks with their biggest industrial customers to see how further cutbacks in consumption can be achieved. It’s going to be a tough winter…..
The Minister told the media conference at Eskom HQ that electricity remains one of the critical building blocks for economic growth – even if there isn’t enough of it (my words not hers). She noted that Eskom continues to face challenges in the absence of significant new capacity being brought on line.. This means things are going to be very tight in the short to medium term. Due to the levels of tariff hikes which have been granted being lower than Eskom wanted, the utility faces a R225bn funding shortfall. Efforts are underway to close the gap, but not much light was shed on this, so to speak…. Acting Eskom CEO Collin Matjila gave a very long, very detailed and very dull update which pretty much echoed the minister’s gloomy message. He emphasised that the system remains tight and vulnerable this winter. Demand is highest during this period of winter. Industrial and other business customers have come to the party by reducing demand, but even so on 3 emergency occasions in February and March, industrial customers were instructed to further reduce demand. On one of these days, there were wider power cuts so we could all join in the fun. In a statement which would have been funny were it not so serious, the electricity boss then postulated that sometimes people use appliances to heat their homes even when it is not really that cold. Instead of living in a nicely heated home, he wondered why we don’t dress for the weather – to postpone the switching on of our electric heaters? And why not use gas heaters and – this one was probably the best remark of the morning – why not use hot water bottles? The acting CEO confirmed that the probability of load reductions and load shedding remains high – in the event of significant “incidents” on the power system. In other words, we are so close that it won’t take much to trigger more power cuts. And to prepare for this, he advised residential customers to familiarise themselves with load shedding schedules…He even gave the link….. http://loadshedding.eskom.co.za/.
Now I could have misheard the Eskom chairman, because I was sitting near the back of the room for easy escape, but I am pretty sure that not only did he echo this ’we need to save’ message, but I think he also suggested this would be patriotic. Instead of laying down your life for your country, why not turn off your heater, put on a wooly sweater and sit in the dark?
During questions, various official confirmed that Eskom is again talking to its industrial customers to seek ways of further reducing demand. The platinum industry has been playing its part, with consumption halved during the current strike, but that can’t go on forever.
My old chum Tshediso Matona, who is Director General at Public Enterprises, confirmed that a strategy is being devised to work out the focus of new power generation investment – gas is a “no brainer”, There is likely to be a new coal-fired plant, but there still needs to be a decision on nuclear. His body language suggested to me that there is some back-tracking on this nuclear option, but nothing definite emerged. He also noted that Stats SA has been asked to investigate the widely held belief that electricity shortages are holding back economic growth. He questioned how much of the economic malaise is due to shortage of electricity and how much due to world economic conditions, noting that during the day there is sufficient capacity. The shortages kick in in the evening. And he claimed Eskom has never turned down someone who has wanted to be connected.
A new CEO has been selected by ESKOM and the proposal is with government. It can’t come too soon.

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Auto and Purchasing Manager Data Suggest Economy is in Reverse

It may be that one of the roles of a politician is to reassure the peasants. However, this peasant did not feel there was a lot of credibility in yesterday’s assurances to the City Press from our recently anointed finance minister Nhlanhla Nene that the economy is not heading into a recession. Certainly, the two important economic indicators out today tend to suggest that when the data for the current quarter are released, they may well show that it followed Q1 in being a period of negative growth. Firstly, there was the Kagiso Purchasing Managers’ Index (PMI) for May, which fell to 44.3, down from 47.4 the previous month. Then came the monthly numbers from the automotive manufacturers’ association Naamsa, showing that year-on-year sales had fallen by 9.2% – with a shock 40.5% year-on-year decline in vehicle exports. Two horrible bits of economic news, which by no means give any backing to the assurances we have seen from our new finance minister, who appears to have had the chair pulled out from under him, so to speak. I just hope that when the Q2 GDP numbers are released that he is proved right, and I am proved wrong.