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Tuesday, 23 September 2014
Transnet Says Slow South African Growth Not Hampering Investment
Transnet SOC Ltd., South Africa’s state-owned ports and rail company, will pursue its 312 billion rand ($28 billion) seven-year investment program even with an economy set to expand at the slowest pace since the 2009 recession, Chief Executive Officer Brian Molefe said.
“It is below our assumptions of growth,” Molefe said in an interview in Maputo, the capital of neighboring Mozambique, yesterday. “We are not perturbed by it.”
South Africa’s central bank last week cut its growth forecast for 2014 to 1.5 percent from 1.7 percent as policy makers kept interest rates unchanged to bolster an economy battered by strikes. Transnet is funding improvements to its rail, port and fuel pipeline infrastructure in Africa’s second-biggest economy using a combination of cash and debt.
“The investments that we are making are for the long term,” Molefe said. “They are investments that are required to be made during this kind of cycle.”
The company would be able to ready an Islamic bond sale “at very short notice” if there was an opportunity to sell sukuk, he said. South Africa last week sold it first Shariah-compliant debt at a record-low cost.