Johannesburg - Standard Bank elevated its risk appetite in January and allocated increased amounts to invest in various industries, particularly focusing on the renewable energy sector, after Cyril Ramaphosa was elected as ANC president at the party’s congress in late 2017.
This is according to Standard Bank South Africa CEO Lungisa Fuzile.
“We are exceedingly optimistic about the future of this country… much more so now than we were before December and certainly we got a further uplift in February when there was a change of presidents,” said Fuzile, a former Treasury director-general, speaking frankly on Tuesday night in Sandton.
Fuzile, who was appointed as Standard Bank CEO in December, said that Africa’s largest lender has allocated R10 billion to growing the renewable energy sector and the bank had anticipated that agreements with the Independent Power Producers (IPP’s) would be signed after Ramaphosa’s victory.
Agreements for the construction of 27 IPP projects, with an estimated investment value of R56bn, were signed after several delays in April.
“Of course, we were hoping that other sectors would take off but they have not taken off as fast...so we are looking for opportunities and energy not only for SA but across the continent,” said Fuzile.
Fuzile, who resigned from Treasury in April 2017 after twenty years in the public service, warned that it is “unrealistic” to think that Ramaphosa could have turned the economy around in a few months after becoming president of the country in February.
“Of course, emotionally, because of the difficulties of the period through February when there was a change, people expected that the economy was going to fire on all cylinders, all too quickly.”
Fuzile formed part of a high level panel discussion on Tuesday night considering how to manage risk in an age of rising protectionism.
Deputy Managing Director of the International Monetary Fund Zhang Tao, Chairman of the Bank of China Chen Siqing, and Vice President and CFO of the New Development Bank Leslie Maasdorp all decried protectionist measures instituted by the Trump administration in the US, arguing that globalisation is irreversible.
According to Fuzile, he expects the leaders of the five Brics nations to make a strong statement in the Johannesburg Declaration against threats of increased import tariffs.
Heads of state from Brazil, Russia, India, China and South Africa will attend the Brics Business Forum on Wednesday afternoon where one thousand delegates are expected to meet and discuss issues.