1. Authorised Financial Services Provider – FSP No: 859

2. Evolusie, kundigheid en instellings: Die Suid Afrikaanse Ekonomie Presented by: Dawie Roodt 16 September 2008

3. Australopithecines 5.5mya Paranthropus 2.7 mya Homo Habilis 2.5 mya Homo Erectus 1.5 mya Neanderthals 230k ya Homo Sapiens “Humans” Migrate across Asia & Europe 195,000 yrs ago Evolution Timeline

4. Hunter-Gatherers Nomadic Small Groups No Specialisation No ‘Surplus’ Diet: High Protein Low Fat Short Life expectancy

5. Domestication of Animals Domesticate animals Bigger clans Nomadic Diet High Protein More Fat Longer life expectancy Small surplus

6. Civilisation: Mesopotamia Domesticate plants – especially grain Carbohydrates more energy free time ‘surplus’ Non-nomadic Cities Spesialisation Civilisation: ‘tall buildings’

7. Key Characteristics of Civilisation Organised Government Complex Religion Job Specialisation Social Class Writing & Record Keeping Arts & Architecture Public Works Monotheism Polytheism Royalty Priests Traders Labourers

8. Dawn of Democracy Establishment of Institutions…

9. Destruction of Institutions Democracy: New Leader Appointed Ecstatic! Change Economic Policy: More ‘democratic’ Negative Impact on Investment Savings Confidence UNDERMINES Economy Take from the “Haves” (non-supporters) Give to the “Have-Nots” (supporters) IGNORES Private Property Rights

10. Destruction of Institutions Democracy: New Leader Appointed Ecstatic! Change Economic Policy: More ‘democratic’ Take from the “Haves” (non-supporters) Give to the “Have-Nots” (supporters) Negative Impact on Investment Savings Confidence Media & Press: Report on Disapproval and Objections by Public BANS Freedom of Press Court & Legal System: Public tries to find Justice through legal system DESTROYS Independent Judiciary Start to Print Money Capital Dwindles…. DESTROYS Independence Central Bank IGNORES Private Property Rights UNDERMINES Economy Inflation: 19,000,000%

11. Destruction of Institutions Democracy: New Leader Appointed Ecstatic! Change Economic Policy: More ‘democratic’ Take from the “Haves” (non-supporters) Give to the “Have-Nots” (supporters) Negative Impact on Investment Savings Confidence Media & Press: Report on Disapproval and Objections by Public BANS Freedom of Press Court & Legal System: Public tries to find Justice through legal system DESTROYS Independent Judiciary Start to Print Money Capital Dwindles…. DESTROYS Independence Central Bank IGNORES Private Property Rights Voting System: Public tries to vote dictator out DESTROYS Democratic Process UNDERMINES Economy Democracy: Mugabe-Style 1 Man, 1 Vote, 1 Candidate!

12. Destruction of Institutions Democracy: New Leader Appointed Ecstatic! Change Economic Policy: More ‘democratic’ Take from the “Haves” (non-supporters) Give to the “Have-Nots” (supporters) Negative Impact on Investment Savings Confidence Media & Press: Report on Disapproval and Objections by Public BANS Freedom of Press Court & Legal System: Public tries to find Justice through legal system DESTROYS Independent Judiciary Start to Print Money Capital Dwindles…. DESTROYS Independence Central Bank IGNORES Private Property Rights Voting System: Public tries to vote dictator out DESTROYS Democratic Process UNDERMINES Economy

13. Destruction of Institutions in SA? Private Property Rights 2008: Land Expropriation Bill

14. Freedom of Press Destruction of Institutions in SA?

15. Independent Judiciary Destruction of Institutions in SA? Zuma’s Mauritius Papers

16. Independence Central Bank Destruction of Institutions in SA? interest rate SARB Hikes 10 Times!

17. Democratic Process POLOKWANE Destruction of Institutions in SA?

18. ZimBOBwean Economy: Breakdown

19. South African Economy: Breakdown Source: StatsSA, Q108

20. South Africa:

21. Economic Overview 200620072008 M3 (average)23.1%23.7%20.0% PSCE (average)27.6%22.2%19.9% CPIX (average)4.6%6.5%11.6% Prime (end of year)12.5%14.5%15.5% Current Account: Nom-R111.0bn-R138.2bn-R164.0bn Current Account: GDP-6.4%-7.3%-7.2% R/$ (end of year)R7.04R6.84R7.80 GDP (full year)5.4%5.1%3.0% Budget Surplus/(Deficit): GDP (0.3%)0.7%0.4%

22. Household debt to disposable income Source: SARB and own calculations 44.5% 50.2% 56.9% 59.4% Q208: 76.7%

23. Savings to disposable income of households Source: SARB and own calculations 9.2% 5.4% 2.6% 0.5% Q208: -0.5%

24. Economic Overview 200620072008 (est.) M3 (average)23.1%23.7%20.0% PSCE (average)27.6%22.2%19.9% CPIX (average)4.6%6.5%11.6% Prime (end of year)12.5%14.5%15.5% Current Account: Nom-R111.0bn-R138.2bn-R164.0bn Current Account: GDP-6.4%-7.3%-7.2% R/$ (end of year)R7.04R6.84R7.80 GDP (full year)5.4%5.1%3.0% Budget Surplus/(Deficit): GDP (0.3%)0.7%0.4%

25. Source: StatsSA and own calculations CPIX Average: 2008 11.6% Inflation

26. Economic Overview 200620072008 M3 (average)23.1%23.7%20.0% PSCE (average)27.6%22.2%19.9% CPIX (average)4.6%6.5%11.6% Prime (end of year)12.5%14.5%15.5% Current Account: Nom-R111.0bn-R138.2bn-R164.0bn Current Account: GDP-6.4%-7.3%-7.2% R/$ (end of year)R7.04R6.84R7.80 GDP (full year)5.4%5.1%3.0% Budget Surplus/(Deficit): GDP (0.3%)0.7%0.4%

27. Economic Overview 200620072008 M3 (average)23.1%23.7%20.0% PSCE (average)27.6%22.2%19.9% CPIX (average)4.6%6.5%11.6% Prime (end of year)12.5%14.5%15.5% Current Account: Nom-R111.0bn-R138.2bn-R164.0bn Current Account: GDP-6.4%-7.3%-7.2% R/$ (end of year)R7.04R6.84R7.80 GDP (full year)5.4%5.1%3.0% Budget Surplus/(Deficit): GDP (0.3%)0.7%0.4%

28. Economic Overview 200620072008 M3 (average)23.1%23.7%20.0% PSCE (average)27.6%22.2%19.9% CPIX (average)4.6%6.5%11.6% Prime (end of year)12.5%14.5%15.5% Current Account: Nom-R111.0bn-R138.2bn-R164.0bn Current Account: GDP-6.4%-7.3%-7.2% R/$ (end of year)R7.04R6.84R7.80 GDP (full year)5.4%5.1%3.0% Budget Surplus/(Deficit): GDP (0.3%)0.7%0.4%

29. Economic Overview 200620072008 M3 (average)23.1%23.7%20.7% PSCE (average)27.6%22.2%18.2% CPIX (average)4.6%6.5%11.6% Prime (end of year)12.5%14.5%16.0% Current Account: Nom-R111.0bn-R138.2bn-R164.0bn Current Account: GDP-6.4%-7.3%-7.2% R/$ (end of year)R7.04R6.84R7.80 GDP (full year)5.4%5.1%3.0% Budget Surplus/(Deficit): GDP (0.3%)0.7%0.4%

30. Background Gold Deficit Surplus

31. Where did the Money Go? Poverty Relief Education ; The ‘Skills Debate’

32. To Stay or Not to Stay...?? Source: Documented Migration Publication, StatsSA IMD World Competitiveness Yearbook 2007: “SA’s brain drain is one of the worst in the world”

33. To Stay or Not to Stay...?? UKAustraliaCanadaSouth Africa Average Destination of Emigrants (%) 33%15%3% Eco Indicators Real Eco Growth (GDP, 2007,Q3) 2.4%4.3%2.9%4.7% Inflation (CPI, avg. 2008)2.1%3.2%1.9%7.2% Currency p US$£0.51$1.14CAN$1.02R7.10 Marginal Tax Rate40%48.5%29%40% Socio Indicators Life Expectancy at birth79.080.980.343.0 Adult Literacy rate (>15yr,%) 99.0 82.4 UN HDI Rank16 th – 0.8534 th – 0.9613 rd - 0.962121 th – 0.674 Murders p capita, rank (100 000) 46 th – 1.443 th – 1.544 th – 1.492 nd – 49.6 Sources: Economic Indicators, Economist. UN HDI 2007/2008, 7 th UN Survey of Crime Trends 1998 – 2000

34. Importing Skills – A realistic solution..? US (1 st ) UK (7 th ) Australia (6 th ) Canada (3 rd ) India (17 th ) China (26 th ) South Africa (30 th ) Source: “Mapping Global Talent” - Heidrick&Struggles and The Economist Intelligence Unit, 2007

35. Education Expenditure Comparison Source: Human Development Report, 2006 (undp.org) Average: 4.7 Equatorial Guinea Zimbabwe South Africa (’06 & ’07) Lesotho

36. The Reading Literacy of Fourth Grade Students Source: US Department of Education, PIRLS 2006 HighIntermediateLowNone Russian Federation(565) United States (540) Macedonia (442) South Africa (302) Morocco (323) Qatar (353)

37. Matric Pass Rate and Exemptions Source: Department of Education, Matric Results Press Release, 2007

38. Matric Results: Maths and Science 2007 Maths HG 6.9%; Science HG 7.6% Source: Department of Education, Matric Results Press Release, 2007

39. The Two Complimentary E ’s: E ducation and E mployment EducationUnemployment Grade 1133.2% Grade 1224.4% NTC 1 to NTC 11116.5% Dipl./Cert with Grade 1210.5% Degree/Higher3.1% Source: Labour Force Survey Sept 2007, StatsSA

40. www.efgroup.co.za Authourised Financial Services Provider – FSP No: 859