EDITORIAL: We’re not as insulated as we think from coronavirus fallout
In SA, we might think we’re insulated. But don’t be fooled
The fallout might seem a world away but, incrementally, the impact of the coronavirus is being felt at home — even though SA has yet to confirm a single case of the virus.
On Tuesday, Reserve Bank governor Lesetja Kganyago warned that the virus is likely to have a knock-on impact throughout the world. Quite how bad this will be for SA, he couldn’t quantify now.
For SA, it’s the black-swan event that the country could scarcely afford, buckling under an Eskom-induced debt load and anaemic, sub-par growth.
During Chris Griffith’s final results presentation at Anglo Platinum, for example, he mentioned how the virus may yet affect the company. But looking across the waters, we’re already seeing evidence of it hurting corporate profits.
Cellphone maker Apple said on Monday that it won’t make its targeted revenue for the half year, in part, because of the coronavirus hurting sales in China. Since China accounts for about 16% of its sales, this is entirely understandable — but it wiped 5% off Apple’s stock price.
Globally, we’re seeing similar reports: investor sentiment in Germany taking a knock, India’s industrial businesses suffering and revenues faltering in countries like Nigeria and Angola, as the price of oil comes under pressure.
In SA, we might think we’re insulated. But don’t be fooled.