"Gloria remains a much-loved pioneer in the field of economic empowerment for women and a well-respected businesswoman"

The 59-year-old Motlanthe became South Africa’s interim president on 25 September 2008. Affectionately known as Mkulu, a term of veneration that means ‘elder’ or ‘leader’, he is seen as a left-leaning intellectual who is not afraid to speak his mind.

2008 is likely to go down in history as a tumultuous year for South Africa. A year that started with a power crisis and was followed by the global economic crisis - an active political arena back home that saw the ruling African National Congress (ANC) decide to recall Thabo Mbeki as the country’s president - voting in Kgalema Petrus Motlanthe, the ANC’s deputy president and former secretary general, as interim president of South Africa until the next elections, expected to take place in April 2009.

The Carbon Market has the potential to become one of the world’s largest commodity markets within the next few years according to AAP Carbon Limited, a Kyoto Protocol Clean Development Mechanism (CDM) project developer operating mainly in the ferro-alloy sector in South Africa.

The global CDM market has seen unprecedented growth from US$4.5 million in Feb 2005 to US$36 billion in the last three years, and the potential for the market is virtually unlimited, said Shaun Reinecke, Business Development Executive for AAP Carbon.

Although more cautious in his time projections, Andre Fourie, CEO of the National Business Initiative, agrees that trade in carbon credits will be a massive part of the financial market in the next decade or so.

When the foreign exchange market started, there were the same hesitations you see when you talk about carbon trading – people were wondering how to align and calculate the value of fluctuating currencies on a daily basis … and it is the same with carbon trade. Given the recalcitrant stance of the US on carbon emissions, markets might start off as regional entities before we see a common global carbon market, said Fourie who is also a member of the National Environmental Advisory Forum.

Despite the current volatile nature of world markets offshore investments are continuing to attract South African investors, who are now able to invest ZAR 2 million offshore in their private individual capacities. Figures from the Association of Collective Investments show a net inflow of ZAR803 million in the last quarter of 2007 into foreign currency dominated retail funds, followed by a net investment of ZAR459 million during the first quarter of 2008.

Information from Sanlam Private Investments (SPI) corroborates the growing offshore investment trend, with two-thirds of all SPI business in the first two months of this year being placed offshore. 

This leaves one nagging question: is offshore investment currently a sound investment policy for South Africans, or is it a desperate attempt to hedge one's bets driven by a combination of political and economic fear?

South Africa has successfully pursued an inflation targeting monetary policy with a range of 3 - 6% on a continuous basis since February 2000. The policy has encouraged a stable and sustainable economy that has seen an increase in the annual growth rate to an average of 3.5% since 1999, and above 5% for 2007.

But with inflation breaching the upper end of the inflation target in April 2007, a spate of generally unpopular interest rate hikes (a 200 basis  point increase since June 2007), has placed the South African Reserve Bank Governor, Tito Mbonweni, and the Monetary Policy Committee (MPC) under increasing pressure.  Formerly robust consumers, who are starting to feel the pinch of rising credit costs, are criticising the central bank for pursuing its mandated forward-looking and rules-based monetary policy of inflation targeting; and politicians, ever conscious of the populist view, are advocating the abandonment of inflation targets for short term job creation - and more votes.

Over and above the "eina" effect of rising interest rates felt by consumers and politicians alike, the central banks' persistent policy of inflation targeting is taking flak; particularly with a leftist surge in the ANC hierarchy which has seen a number of people begin to question the validity of the reserve bank's control policy as they advocate their more socialist preferences.

Cosatu has called for the Reserve Bank to abandon its targeted range, saying that it wants monetarists to accept that South Africa is a developing economy with a 6% growth target, and strongly advocating a trade-off of higher inflation, arguing that there is scope for inflation to be higher than the targeted range without it adversely affecting the economy.