Economic

and Management Sciences

Grade 9

EDUCATOR GUIDE 2021

EXCLUSIVE
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Activities NEW
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FR earni ces Activities
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Head, heart and hand series

Yvette Gietl

WAMARK
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THIRTEENTH EDITION 2017
 ECONOMIC AND
MANAGEMENT SCIENCES

GRADE 9
THEORY AND WORKBOOK

2021 EDITION

Y. T. GIETL

7KH(066SHFLDOLVWV

WAMARK EDUCATIONAL PUBLISHERS

7KH(066SHFLDOLVWV

WAMARK EDUCATIONAL PUBLISHERS

wade.g7@gmail.com
072 827 7925
www.wamark@gmail.com

Cover design by Y T Gietl

Typography by S Jordaan and Yvette Gietl

Printed by Repro Print India

ISBN 978-0-9585017-3-6

Fifteenth(GLWLRQOctober 2018

© All rights reserved

No part of this book may be reproduced
or transmitted in any form or
by any means, electronic or mechanical,
including photocopying, recording,
or any information storage and retrieval system,
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 ECONOMIC AND MANAGEMENT SCIENCES GRADE 9
INDEX
ASSESSMENT
LEARNER SUPPORT MATERIAL PAGE ACTIVITY NUMBER PAGE
• Personal Goal Statement 1-2
• Plot your Progress 3-4
• Continuous Homework Assessment 5-6
1. THE ECONOMY
1.1 Factors of production (Revision) 7-8 • Presentation 1 9 - 14

1.2 Economic systems 15 - 18 • Assignment 2 19 - 20

1.3 Role-players in the economy 21 - 26 • Test 3

1.4 The role of the foreign sector

in an open economy 27 - 30 • Assignment 4
37 - 38

1.5 SADC 39 - 40 Worksheet 5 41 - 42

•
1.6 Banking 43 - 46
The South African Reserve Bank (SARB)

1.7 The flow of money 47 - 48 • Presentation 6 49 - 50

1.8 The role of savings and
51 - 54 • Presentation 7 55 - 56
investment in the economy

1.9 The Economic Cycle 57 - 62 • Worksheet 8 63 - 68

1.10 National income 69 - 70

• Data Response 9 73 - 78
1.11 The National Budget 71 - 72 • Data Response 10 79 - 80

1.12 Demand and supply 81 - 82

1.13 Market equilibrium 83 - 86

1.14 Changes in demand

(Increase and decrease) 87 - 88

1.15 Changes in supply

(Increase and decrease) 89 - 90

1.16 Trade unions

• Worksheet 11
Role, rights and responsibilities 91 - 96 97 - 100

1.17 The influence of trade unions

in general and during 101
Apartheid

1.18 The role of women in Trade

Unions 102 - 104 • Project 12 105 - 106

1.19 Productivity
107 - 112
(Inputs vs Outputs)
 ASSESSMENT PAGE
LEARNER SUPPORT MATERIAL PAGE ACTIVITY NUMBERS
2. FINANCIAL LITERACY
2.1 Cash and credit purchase 113 - 117
2.2 National Credit Act • Worksheet 13 121 - 122
(NCA) 118 - 120
• Worksheet 14 123 - 126

3. ENTREPRENEURSHIP
3.1 Sectors of the Economy 127 - 128

3.2 Interrelationships between the

sectors/ industries 129

3.3 Sustainable use of resources 130 - 132

3.4 The role of the 3 sectors in the economy • Data 133 - 134
regarding Employment and skills 15
Response
required in each sector

3.5 The nine functions of business 135 - 138 • Case Study 16 139 - 142

3.6 Advantages and disadvantages

of entrepreneurship 143 - 144

3.7 Small, medium and micro • Written

enterprises 145 - 146 • Presentation 17 147 - 148

3.8 The New Companies Act

149 - 152 • Crossword 153 - 154
CIPC 18
MOIF
3. 9 Forms of Ownership
• Crossword 19 155 - 156
Companies, Co Operatives, CC's,
Sole Proprietry and Franchises 157 - 160
Advantages and disadvantages of the
different forms of ownership 161 - 168
3.10 Why a business plan? 169
COVID19 Poster &
3.11 Format of a business plan 170 • Questionnaire 171 - 72

3.12 Business plan rubric 173 - 174

3.13 Target Market 175 - 176

3.14 Projected profit and loss 177 - 178

3.15 Production costing 178 - 180 • Production costs 183 - 184

Unit price, % m.u 20
Break Even Point 181 - 182 selling price,
3.16 Marketing 4 P's 185 • Case Study 21 189 - 190
Marketing plan 186
Market Research 187 - 188 • Market research
22 191 - 192
questionnaire
• SWOT Analysis 195 - 196
3.17 SWOT analysis 193 - 194 23
Case Study
• SWOT Analysis 24 197 - 198
COVID 19
• SWOT Analysis 25 + 26 199 - 202

3.18 Advertising 203 - 204 • Practical

27 205 - 206
demonstration
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SHORT TERM GOALS (Values & Attitude)

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LEVEL DUE DATE:

Topic: Factors of Production - Amarula

https://www.youtube.com/watch?v=SltbcCDLUlo

5HDGWKHDUWLFOH³0DUXODPHDQVPRQH\´)DUPHU¶V:HHNO\0DUFK

Marula means money

The United Kingdom’s department of
international development’s studies on marula
usage in South Africa and Namibia show that
marula beer and wine earn an average monthly
income of R250 for some families.
and soap, while the kernel can be turned into
oil or snacks. Some communities use most
parts of the tree to make various medicines.
Marula has five times more vitamin C than
citrus.

They are urging Southern African - African Eye News Serive

governments to invest in the marula fruit
industry.

“There’s absolutely no government investment

in the marula industry, and governments don’t
consider the fruit as having the potential for
local and international markets,” said Myles
Meander of South Africa’s Institute of
National Resources.

The fruit can also be used to make jam, juice

ACTIVITY 1

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Note to educator: Learners can chose 4 different colour pencils/ highlighters. They can colour all the
Natural Resources in green, Labour in blue and so on.

10
 $FWLYLW\

Marula Natural Products (Pty) Ltd Factories - production plant Nurseries - propagate new trees Propagation of new marula
trees

Developing trade relations Marula Bark Land where Marula trees found Transport
naturally Limpopo Province,
Kwazulu Natal, Eastern Cape
Mental & physical and Mpumulanga Production processes
Money, Capital Goods, Technology
effort of people

Hand washing and peeling “Decortication” cracking of Marula Marula tree bearing
Organic processing equipment
of fruit nuts on a stone to extract the kernel 500kg of fruit per year

Fair trade practices

Marula leaves • Fair Pricing Products of high quality Storage facilities
• Equitable consultation
& negotiation
Land, water, plants etc
• Ownership
• Transparency Marula Kernel
Innovation
• Equal Opportunities
Empowerment
• Concern for
11

environment Knowledge of African

Quality Control • Respect for cultural
Marula Nut Traditions
assets

Harvesting (Jan - March) Products - juices, jam, jellies,

Ripe fruit collected from
ground by 5000 women in
rural communities
Carving - pestels, mortars,
Freezing facilities and equipment ciders, essential oils, edible oils
bowls, drums, beehives etc.,
and fruit pulp
From the wood.

Combination of Skills, Knowledge, Sustainable development

values and a attitudes to produce Donor Funding for community
Sustainable harvesting practices
products (Business activities) projects:
• Schools, clinics, halls
• Communication facilities
• Capital expansion - Sorting of fruits
Refining technology and Filtration technology equipment for processing
equipment and equipment

Research and Development Poverty alleviation Create demand

Marula Wood

Marula Fruit Accessibility

eg. roads and communication Marketing
12
 MEMORANDUM
Factors of Production
Products from the Marula Tree
-
,., � 'f'�j_�_ 4
\t-: !9
'�
V"-= --..,.,Y ,
NATURAL RESOURCES LABOUR CAPITAL ENTREPRENEURSHIP

r � �;�J�
�\,
'I �
I -.- Combination of Skills, Knowledge,
. �-;..-::.....;;.;;;:--._--t values and a attitude to produce
. ·~
,,,c-
�=
~c::::-:
Money, capital goods, technology products {Business activities)
Factories - production plant Marula Natural Products (Pty) Ltd
Land, water, plants etc Mental and physical Products - juices, jam, jellies,
effort of people Organic processing equipment ciders, essential oils, edible oils
Land where Marula tree
Harvesting (Jan - March) and fruit pulp
found naturally
Limpopo Province Ripe fruit collected from
ground by 5000 women
Filtration technology & equipment
..
Fair trade practices
Fair Pricing
Kwazulu Natal
Eastern Cape and in rural communities Refining technology and .. Equitable consultation & negotiation
Ownership
13

Mpumulanga
Carving - pestel & mortars,
equipment
.. Transparency
Equal Opportunities
Marula tree bearing bowls, drums, beehives etc
Donor Funding for community
projects: . Concern for environment
Respect for cultural assets
500kg of fruit per year from the wood. • Schools, clinics, halls Sustainable development
• Communication facilities
Marula nut "Decortication" cracking of • Innovation
Capital expansion -
Marula nuts on a stone equipment for processing
Marula fruit Create demand
to extract the kernel
Marula kernel Poverty alleviation
Sorting of fruit Nurseries - propagate new
trees Empowerment
Marula bark Sustainable harvesting practices
Hand washing and peeling
of fruit Knowledge of African Traditions
Marula leaves Freezing facilities & equipment
Propagation of new Marula trees Marketing
Storage facility
Marula wood Products of high quality
Transport (Vehicles) Developing trade relationships
 )DFWRUVRI3URGXFWLRQ 'DWHBBBBBBBBBBBB
Marula

NATURAL RESOURCES ENTREPRENEURSHIP LABOUR CAPITAL

14
 ECONOMIC SYSTEMS

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16
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e.g. Mining
* Taxes on the working class are high in
order to compensate for the needy
* Highly active unions have a negative
impact on investment due to strikes and
high cost of salaries and wages
*Privatisation of roads e.g. Toll makes
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Topic: South Korean Economic System

96

https://www.youtube.com/watch?v=U21eTFAc1CE

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25
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30
 The Economy NAME:
TEST GRADE:
Covid 19 and the effect on DATE:
the South African Economy

ACTUAL MARK TOTAL : 65

% DUE DATE: _____________________
LEVEL Assessment number: 3

Refer to the excerpt from the article “South Africa extends

lock-down but offers road-map for reopening” by Elliot
Smith and pages 31 - 32 of Wamark EMS 9 workbook
Milestones to easing the lockdown restrictions
1. Discuss the “milestone” set by Salim Abdool Karim
(Chairman of Covid-19 Advisory Committee
for lifting or easing the restrictions of the extended lockdown.
________________________________________________________________________
The easing of restrictions would depend on the average rate of new infections.
_________________________________________________________________________
Any restriction e.g. Homebound, only allowed out to by essentials etc.
______________________________________________________________________ (4)
2. Mention one restriction of phase 5 of lock - down.
______________________________________________________________________
Any restriction e.g. Homebound, only allowed out to by essentials etc. (1)
3. Which citizens are allowed to travel to work during stage 5? ______________________ Essential services workers (1)
4. List three (3) Essential Services that can operate during the lock-down period
___________________
e.g. Doctors, pharmacies, dentists _______________________
Distribution of essential goods, Fuel, security ______________________
Food production, transport of essential workers etc. (6)

Cost to the Economy

5. What does GDP stand for and describe what it means?
________________________________________________________________________
Gross Domestic Product - Includes the value of all Local and foreign production in a country
______________________________________________________________________ (1)
6. Explain why the GDP will contract due restrictions on consumer spending during
stage 5 lockdown and give 2 examples.
________________________________________________________________________
Non essentials are not allowed to be produced nor are they allowed to be purchased. e.g. clothing, car manufacturing. appliances etc.

________________________________________________________________________
________________________________________________________________________
______________________________________________________________________ (4)
7. What is the SARB and how have they assisted banks with regards to Monetary Policy i.e.
the repo rate i.e. lending rate to banks and in turn interest rates to consumers? Include 4
examples of interest bearing accounts.
________________________________________________________________________
The South African Reserve Bank. The SARB has reduced the repo rate to banks. In turn the banks lower the interest rates to
________________________________________________________________________
their consumers. This will reduce the consumers interest rate on loan payments including car and home payments, personal loans
________________________________________________________________________
and overdrafts
______________________________________________________________________ (8)
8. Fiscal policy – Announcements made by ___________________________
the Minister of Finance regarding the
increase or reduction in taxes e.g. increase in VAT from 14% to 15%. List 3 more forms of
taxes which are an income for Government include ________________ PAYE _______________
Income (Profits)
_______________ _______________
Import Tax (5)
9. What has happened to inflation due to the extended lock-down and slow economic recovery
and how has this affected Monetary Policy?
______________________________________________________________________
The rate of inflation has slowed down and therefore interest rates have been brought down. (2)

27
 Name and Grade: _____________________________________

10. How does lower interest rates help those paying off loans, credit cards and home loans?
________________________________________________________________________
The payments are lower due to a lower interest rate on the amount owing.

_____________________________________________________________________ (2)
11. The goal in lowering of interest rates is to stimulate the economy. How will this help with
families where one or more member has had to take a salary cut?
________________________________________________________________________
With the lowering of interest rates and the decreased monthly payments for credit, households will have more disposable income.

________________________________________________________________________
With the addition cash on hand,they will be able to buy essential goods for their households.

________________________________________________________________________
______________________________________________________________________ (6)

Recession and Economic Recovery

An economic crash will lead to a recession. A recession is a natural part of an economic cycle.
The four stages of an economic cycle are:
Expansion: Growth in GDP
Peak: Highest Level of GDP
Recession – Fall in GDP over 2 consecutive quarters (3 months = 1
quarter) Recovery – GDP of an economy showing growth after a recession.

President Cyril Ramaphosa made an announcement on the 22nd of April 2020 that
a R500bn stimulus packaged had been required.
• The fund shall be prioritised for the Health sector
• Grant beneficiaries will receive additional allowances for 6 months:
- Child Grants: R300 p/m initially, then R500 p/m from June to October
- Other Grants: R250 p/m
• Persons with no income, and are not grant beneficiaries: R300 p/m for 6 months
• R130bn fund acquired and to be distributed as follows:
- Health Response: R20bn
- Municipal Relief: R20bn
- Hunger and Social Distress: R60bn
• SASSA to implement a tech based solution for issuing vouchers and cash transfers for food
• Department of Social Development with Solidarity Fund will distribute 250000 food parcels
• R40bn allocated for persons whose employers cannot afford to pay salaries and wages
• R2bn allocated to relieve SMME's, Spaza Shops, and the rest of the informal sector
• R200bn loan scheme introduced for businesses with a turn-over of less than R300m.
• 4 month payment holiday for Skills Development Levies, acceleration of VAT returns and a delay
in Carbon Tax payments
• PAYE deferred to 35%
• All persons whom have donated to the Solidarity Fund will be able to claim back upto 10% from
SARS
• SARB has cut the Repo-rate by 200 basis points (2%)

12. The 500 Billion will be circulated within the economy and this will stimulate it. Discuss 5
ways how this package will be spent to help stimulate the economy.
___________________________________________________________________________
Grants increased so the recipients will have more money to spend on essential goods and services. People with no income will now also have a small
___________________________________________________________________________
monthly income to help them buy essentials. Money has been allocated to spend on goods and services to help feed the hungry, bail out
___________________________________________________________________________
municipalities as well as medical services to the poor. Food vouchers and parcels will be bought and distributed. UIF will be given to persons not able to work

___________________________________________________________________________
and this income will be usd for essential goods and services etc.
___________________________________________________________________________
_______________________________________________________________________ (10)
28
 Name and grade: ____________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
Question 13
Fill in the crossword -
Use CAPITAL letters

Across Down
1 Fall in GDP over 2 quarters 2 Taxes on profit or loss
6 Lowering of interest rates is a measure to help 3 The SARB decreasing interest rates is an
______ the economy example of ________ policy
9 GDP showing growth after a recession 4 Taxes on goods and services
10 Makes announcements with regards to interest 5 Taxes on salaries and wages
rates 7 The lending rate from banks
12 An economy which trades globally 8 Growth in GDP
13 An economy where there is no foreign trade 9 The SARB's lending rate to Banks
14 The policy with regards to income (Taxes) and 11 Includes the value of all local and foreign
expenditure of the State production in a country.
(___/ 15)

29
30
 Support material – EMS test Grade 9 Test

South Africa extends lockdown but offers

roadmap for reopening
P U BLI SH ED W ED, A PR 1 5 2 02 08 :3 9 A M E D TU PD AT ED W ED , A PR 1 5 2 02 08 :5 5 AM ED T

Elliot Smith @ EL LI O T SM IT H CN BC

Excerpt “Milestones for reopening”

On Monday, South Africa’s Health Minister Zweli Mkhize and chairman of the country’s
Covid-19 advisory committee, Salim Abdool Karim, gave a live online briefing to outline
the criteria under which the country would be reopened.

Karim suggested that the current trajectory was due to “curtailed community
transmission from effective early interventions” but stressed that an “exponential curve
is almost inevitable.”

He said that whether the lockdown would be lifted would depend on the average rate of
new infections between April 10 and April 16. Should infections rise by more than 90
per day, an extension will be implemented, but daily increases of between 45 and 89
may open the door to an easing of restrictions.

“By all accounts, South Africa’s response to Covid-19 has managed to stem the tide in
infections. Leaders like Mr. Ramaphosa and Dr. Mkhize have also handled the
communications challenges well,” NKC African Economics analyst Louw Nel said in a
note Tuesday.

“However, concerns regarding Non-compliance by citizen, persist over the

government’s implementation of the mitigation strategies, not to mention the public
performances of less astute Cabinet members.”

Notably, Communications Minister Stella Ndabeni-Abrahams is serving a two-month

suspension for breaching lockdown rules, while Police Minister Bheki Cele has “noted
with concern” the illegal sale of alcohol and cigarettes by officers during enforcement of
the lockdown.

Defence Minister Nosiviwe Mapisa-Nqakula has also been pushed to condemn heavy-
handed tactics used on civilians by military personnel amid criticism from human rights
organizations, including Amnesty International.

* NKC (National Knowledge Commission) - A team of economists and experts who constantly monitor
economic and political events in South Africa, providing insights and analysis on their short- and medium-
term impact. Analysis is pushed out daily via email, with a weekly summary delivered each Friday.

31
“Economic cost”
The International Monetary Fund (IMF) now projects that South African GDP (gross
domestic product) will contract by 5.8% in 2020 as the economic impacts of the global
and domestic shutdowns are brought to bear.

The South African Reserve Bank (SARB) projects a 6.1% contraction, a drastic
increase from the 0.2% shrinkage expected just three weeks ago.

The two-week extension of the South African lockdown alone is expected to cut overall
consumer spending by $7.5 billion in 2020, according to NKC, representing a reduction
in per capita consumption of around $125 this year. Taking into account the five-week
lockdown, NKC forecasts consumer spending at $186 billion this year, reflecting a 7.1%
reduction from 2019.

Following an emergency meeting over the Easter weekend, the SARB decided to cut
the country’s benchmark interest rate by 100 basis points to a record low of 4.25%,
following another 100 basis point cut in March.

SARB Governor Lesetja Kganyago cautioned that the sharp economic contraction,
increased fiscal risks, a weakening currency and higher borrowing costs for the
government, banks and businesses have heightened the risk to South Africa’s
economy.

However, the extended lockdown and slower recovery will place downward pressure on
inflation, the SARB’s Monetary Policy Committee highlighted, which in turn could free
up space for monetary policy to respond to the demand shock caused by the pandemic.

“A looser monetary stance will support the economy on the margins and the SARB has
adopted a wide variety of measures to improve liquidity conditions,” *NKC’s Jacques
Nel said in a note Tuesday.

“While the SARB was well-positioned to increase monetary stimulus, the magnitude of
the Covid-19 economic shock means there is little it can do to prevent an economic
crash this year.”

32
 THE ROLE OF THE FOREIGN SECTOR IN AN OPEN ECONOMY

There are important differences between national and international transactions:

a) Different countries have different monetary systems. In national trade the

country’s currency is used, but different currencies are used for international trade.

b) Every country has its own laws, customs duties and even export duties. These
export duties complicate foreign trade as such duties are not applied to national
trade.

c) Trade within a country’s borders is usually without restrictions, but trade between
countries is subject to restrictions such as import quotas, currency control, import
and export permits and language differences.

d) Capital and labour flow more freely between different parts of the same country
than between different countries.

e) It is difficult to arrange the granting of credit when the debtor and creditor live in
different countries. In national trade the granting of credit is a common
phenomenon and can easily be arranged.

f) National customs and lifestyles do not differ much from person to person, but may
differ vastly from the customs and practices of other countries. Domestic trade
brings fewer problems than international trade. Cultural, social and political
differences affect foreign trade considerably.

g) Because large distances separate one country from another, many transport
problems present themselves e.g. inaccessible roads and political instability.
These problems increase the cost of transport due to repairs and maintenance of
the trucks, security and insurance. Modern day pirates along the East Coast of
Africa destabilise the shipping trade routes.

33
34
35
notes

36
 The Economy NAME:
ASSIGNMENT GRADE:
South Africa's Open DATE:
Economy

ACTUAL MARK TOTAL : 45

% DUE DATE: _____________________
LEVEL ASSESSMENT NO: 4

1. Watch the first video on page 38. (Remember to download the videos so you can watch
them off line.)
1.1 A group of Developing and newly industrialised countries formed an economic alliance.
The group is called BRICS. What does the acronym BRICS stand for?
______________________________________________________________________
Brazil, Russia, India, China, South Africa (5)
1.2 The alliance of these countries lead to the formation of the _______________________
______________________________________________________________________
New Development Bank (1)
1.2.1 Name two other financial institutions where governments loan money from.
______________________________________________________________________
IMF (International Monetary Fund) and World Bank (2)
1.3 How will this bank serve the BRICS countries? ________________________________ The countries will loan each other money

______________________________________________________________________
for development projects unresticted by Western influence (2)
1.4 China
_____________ is the largest trading country in the world. (1)
1.5 Ten of the thirty fastest growing areas in the world are located in ______________ (1) India
1.6 Which natural resources are found in Brazil? ______________________________ Oil and iron (2)
1.7 Russia is experiencing economic difficulty. Suggest two reasons why.
_________________________________________________________________________
Sanctions and geopolitical problems.

______________________________________________________________________ (4)
1.8 Which country has the strongest economy on the African continent? _____________ South Africa (1)
1.9 How does South Africa assist India and China with trade on the African continent?
_____________________________________________________________________(4)
South Africa provides a foothold on the continent
1.10 Give three reasons why the BRICS alliance is said to be unsustainable?
_________________________________________________________________________
Due to rapid population growth, the resources are depleting. Dominance of China within BRICS (veto power).

_______________________________________________________________________(3)
Mixed records of human rights violations and conflict with neighbouring countries

2. Watch the second video on "South Africa's role in BRICS" and answer the following.
2.1 BRICS is a global representation both economically and politically of the
______________________
Developing countries. (1)
2.2 Where did the funding for the establishment of the New Development Bank come from?
_________________________________________________________________________
Each member country gave $10Bn seed funding

2.3 List five industries in South Africa receiving investment from India.
_________________________________________________________________________
Banking, Insurance, Pharmaceutical, mining, agriculture

______________________________________________________________________ (5)
3. Watch the third video where Roberto Azevedo, Director General of the World Trade
Organisation, gives a statement and complete the following questions.
3.1 How has world trade been affected by Covid 19? ____________________________ Sharp decline in trade (1)
3.2 Is South Africa a member of the WTO? ____________________________________ (1)
Yes

3.3 "No country is self sufficient" Explain what this means and give 2 examples.
_________________________________________________________________________
No country has all the resources to supply its needs and wants.

_________________________________________________________________________
e.g. Sharing of information and technology - countries sharing information and technology regarding Covid to help treat patients and develop a vaccine

_________________________________________________________________________
Once a cure has been developed, pharmaceutical companies around the world will export vaccines to other countries.

_________________________________________________________________________
Energy - South Africa imports coal for energy to meet our country's needs.

______________________________________________________________________
Food - South Africa importing fruit from countries like Australia and Brazil. (Farmers could not harvest at the beginning stages of lockdown. (6)

37
(1) Topic: What are the BRICS countries?

https://www.youtube.com/watch?v=F03yzqR4gYI

(2) Topic: SA's role in BRICS

9:57

https://www.youtube.com/watch?v=JeCp4KqaZ6o

(3) Topic: The World Trade Order

3:26

https://www.youtube.com/watch?v=v_-ZY1QAr2g

38
 SADC (SOUTHERN AFRICAN DEVELOPMENT COMMUNITY)

1. The SADCC

During the Apartheid era on the 1st of April 1980, the SADCC
(Southern African Development Coordination Conference) was founded
by 9 states in Southern Africa namely Angola, Botswana, Lesotho,
Malawi, Mozambique, Swaziland, Tanzania, Zambia and Zimbabwe.
Their aim was to co ordinate development projects as they did not
want to be dependent on South Africa. They wanted to be economically liberated.

2. SADC

On the 17 August 1992 (post Apartheid), the transformation of the SADCC

(Coordinating Conference) to the SADC (Development Community) took place. The
Declaration was signed at the Summit of Heads of State and Government, thereby
giving the organisation a legal charter. The SADC Headquarters are in Gabarone
Botswana.

2.1. There are 16 member states as of 2020

Angola
Botswana
Comoros
The Democratic Republic of Congo
Eswatini
Lesotho
Madagascar
Malawi
Mauritius
Mozambique
Namibia
Seychelles
South Africa
Swaziland
United Republic of Tanzania
Zambia
Zimbabwe

3. The SADC's vision.

The SADC vision is that of a common future, a future within a

regional community that will ensure
• > economic wellbeing
• >improved standards of living and quality of life
• >freedom and social justice for all
• >peace and security for the peoples of Southern Africa

39
6$'&2EMHFWLYHV

‡ 7KURXJKregional integrationWKH6$'&KRSHVWRDFKLHYHdevelopmentDQG
economic growth, alleviate poverty, enhance the standardDQGquality of life
RIWKHSHRSOHVRI6RXWKHUQ$IULFDDQGsupport the socially disadvantaged
‡ Evolve common political values
‡ Promote and defend peace and security
‡ 3URPRWHself- sustaining developmentRQWKHEDVLVRIcollective self reliance
DQGWKHinterdependence of Member States
‡ 3URPRWHemploymentDQGthrifty use of resources
‡ Sustainable utilisation of natural resourcesDQGHIIHFWLYHprotection of the
environment
‡ Strengthen the longstanding historical, social and cultural links of the
peoples of the region

7KHFRXQWULHVWKDWEHORQJWRWKH6$'&DJUHHWKDWXQGHUGHYHORSPHQWDQGH[SORWDWLRQ
LQ6RXWKHUQ$IULFDZLOORQO\EHRYHUFRPHWKURXJKHFRQRPLFFRRSHUDWLRQDQG
LQWHJUDWLRQ

,QSXUVXLWRIWKH6$'&
VREMHFWLYHVWKH6$'&KDVPLOHVWRQHV7KHVHLQFOXGH
‡ )7$)UHH7UDGH$UHDE\
‡ &XVWRPV8QLRQE\
‡ &RPPRQ0DUNHWE\
‡ 0RQHWDU\8QLRQE\
‡ 6LQJOHFXUUHQF\E\

7KH6$'&VLJQHGDWUDGHDJUHHPHQW7UHDW\RIWKH
6RXWKHUQ$IULFDQ'HYHORSPHQW&RPPXQLW\RQWKH
WK$XJXVWZKLFKFDPHLQWRHIIHFWRQWKHWK
6HSWHPEHU

 6$'&)7$

7KH)7$ZDVODXQFKHGRQWKH$XJXVWDW
6DQGWRQ6RXWK$IULFDGXULQJWKHWK6XPPLWRI
6$'&+HDGVRI6WDWHDQG*RYHUQPHQW

7KHFTA (Free Trade Area)HQVXUHVWKHIROORZLQJ

 Free movement of goods – no tariffs and easy cross border trade
 Facilitated trade in the SADC community±VXSSRUWWRimporters and exporters
and by reducing costs of trading
 Creation of a larger market for SADC business±*URZWKIURP86ELOOLRQWR
86ELOOLRQFUHDWHYDOXHFKDLQVDFURVVWKHUHJLRQDQGORZHULQSXWFRVWV
 Delivery of value to households – Reduction of prices through competition
and increased employment opportunities.

40
 'LVFXVVWKHUROHRIWKH
IRUHLJQVHFWRULQWKHHFRQRPLFF\FOH
WORKSHEET

TOTAL : 25
ASSESSMENT : 5

5HDGWKHIROORZLQJQHZVKHDGOLQHV

 ,GHQWLI\WKH6$'&objective.

 ,Q\RXURZQZRUGVH[SODLQWKHrole/actionRIWKH6$'&LQREWDLQLQJLWVJRDOV

 SADC wants rand to prop up Zimbabwe economy-report

$UHJLRQDOERG\ZDQWVWRUHVFXH=LPEDEZH
VLQIODWLRQUDYDJHGHFRQRP\E\VZLWFKLQJWR
6RXWK$IULFD
VFXUUHQF\LQH[FKDQJHIRUSROLWLFDOFRQFHVVLRQVE\3UHVLGHQW5REHUW0XJDEH
DQHZVSDSHUUHSRUWHGRQ6XQGD\
Objective:

Action:

 SADC suspends Madagascar
0DGDJDVFDU
VQHLJKERXUVKDYHVXVSHQGHGLWIURPWKHLUUHJLRQDOFOXEDQGVD\WKH\ZLOO
WDNHIXUWKHUVWHSVLIGHPRFUDF\LVQRWUHVWRUHGWRWKHLVODQGQDWLRQ

Objective:

Action:


 Tsvangirai looks to SADC

,I3UHVLGHQW-DFRE=XPD
VSODQKDGEHHQWRZLQWKHFRQILGHQFHRIDOOVLGHVLQ=LPEDEZH
V
FRDOLWLRQGXULQJKLVYLVLWWR+DUDUHODVWZHHNKHVXFFHHGHG%XWKHDFKLHYHGOLWWOHHOVHLQ
WHUPVRIZULQJLQJUHIRUPIURP5REHUW0XJDEHDQGKLVSDUW\
Objective:

Action:


41
 Thapong centre hosts SADC creator artists workshop
15 October, 2009

*$%2521(3DLQWHUVVFXOSWXUHVFHUDPLFLVWVSULQWPDNHUVDQGRWKHUDUWLVWVDUHLQYLWHG
WRSDUWLFLSDWHLQWKH6$'&FUHDWRUDUWLVWVZRUNVKRSWREHKHOGQH[WPRQWKDWWKH7KDSRQJ
9LVXDODUWV&HQWUH

Objective:

Action:


 Malawi: Rural programme targets dwindling fish

population.

7KHSURJUDPLVDGPLQLVWHUHGE\WKHSADC Natural Resources0DQDJHPHQW3URJUDP

IXQGHGE\WKH8QLWHG6WDWHV$JHQF\IRU,QWHUQDWLRQDO'HYHORSPHQW
$SURJUDPWRLQFUHDVH0DODZL
VILVKVWRFNVLVVWDUWLQJWREHDUIUXLWDVYLOODJHFRPPXQLWLHV
DGRSWLWVSKLORVRSK\RIFRQVHUYDWLRQDQGDSSUHFLDWLRQRIQDWXUDOUHVRXUFHV

Objective:

Action:

6 Busa urges SADC free trade agreement push

%\(YDQ3LFNZRUWK,1HW%ULGJH

%XVLQHVV8QLW\6RXWK$IULFD%86$KDVXUJHGWUDGHPLQLVWHUVRIWKH6RXWKHUQ$IULFDQ'HYHORSPHQW

&RPPXQLW\6$'&WRDGGUHVVWKHRXWVWDQGLQJLVVXHVLPSHGLQJWKHIXOOLPSOHPHQWDWLRQRIWKH6$'&IUHH
WUDGHDUH)7$

%XVLQHVVLQWKHUHJLRQZHOFRPHGWKHODXQFKRIWKH)7$LQH[SODLQHG-HUU\9LODND]LFKLHIH[HFXWLYH
RIILFHURI%XVD:HEHOLHYHWKH)7$LVDQLPSRUWDQWLQLWLDWLYHIRUGHHSHQLQJHFRQRPLFLQWHJUDWLRQDQG
JURZWKLQ6RXWKHUQ$IULFDEXWLWKDVQRW\HWOLYHGXSWRLWVSRWHQWLDO
Objective:

Action:


/LVWWKHPHPEHU6WDWHVRIWKH6$'&

42
 BANKING

1. THE SOUTH AFRICAN RESERVE BANK (SARB)

There are legally only two types of banks in South Africa i.e. South African Reserve
Bank (SARB) with a Governor appointed by parliament and the DTI’s - Deposit Taking
Institutions (Commercial banking). The SARB is the banker to DTI’s through the
reserve requirements and lends money to them at the bank repo rate. Banks are
instructed on the amount to deposit with the Reserve Bank. This amount is known as the
reserve requirement (one of the instruments for implementing monetary policy). The
SARB controls the money supply through direct methods (changes of the
reserve requirements) and indirect methods (control of the interest
rates).

The SARB holds the funds taken by the Receiver of Revenue e.g.
income tax, VAT, skills development levies, import taxes etc. The
SARB draws on these funds as government needs for expenses
such as housing, education, national security, social security etc. If
government expenses exceed the revenue, the reserve bank may
sell government stock to raise the extra money. (Privatisation of
government owned enterprises and assets e.g. Telkom)

The SARB has the sole mandate to issue currency. It is the

custodian of the country’s gold and foreign reserves. With other
agencies, it is responsible for formulating and implementing monetary and exchange
rate policies i.e. Fiscal, Trade and Monetary policies.

1.1 Functions

1.1.1 It has the sole right to make, issue and destroy bank notes and coins.
The SA Mint and SA Bank Note companies operate these functions on behalf of
the Reserve Bank.

1.1.2 As the official bank of the government/state, it currently also holds the accounts of
the Local and Provincial governments. This function has recently been
reduced and Local government can now hold accounts with other banks.

1.1.3 It acts as the banker to other banks. Legally all banks (like Absa, FNB, Nedcor and

Standard) must keep some money with the Reserve Bank.

1.1.4 It stores all the gold and foreign reserves in the country.

1.1.5 The Reserve Bank controls the amount of money that is in circulation in the country.
https://
www.youtube.com/
watch?v=bLMzetK0Pj0

Nationalisation of the Reserve Bank

https://
www.youtube.co
m /watch?
v=nDpBmzTZyt4

43
 The Reserve Bank and the control of inflation
7KHIROORZLQJWDEOHVKRZVIRXUH[DPSOHVRIKRZWKHFRVWRIEDVLFJRRGVKDYHLQFUHDVHG
RYHUDSHULRGRIWLPHGXHWRWKHGHFOLQLQJYDOXHRIWKH5DQG

ITEM 1967 1987 1992 2000

/3HWURO F F 5 5
%UHDG F F 5 5
/0LON F 5 5 5
:HHNO\
F F F 5
1HZVSDSHU

$QLPSRUWDQWWDVNRIWKH5HVHUYH%DQNLVWRprotectWKHvalue of the RandWKDWLVWRNHHS

inflationDVlow as possible,WGRHVWKLVE\IRUH[DPSOHincreasingLWVlending rate
UHSRUDWHWRbanksVRWKDWEDQNVLQWXUQFKDUJHhigher interest ratesRQloansDQG
overdrafts7KLVDFWLRQWKXVPDNHVLWdifficultIRUSHRSOHWRspendPRQH\WKH\GRQRW
KDYHRQJRRGV7KHdemand IRUJRRGVWKHUHIRUHdropsDQGWKLVFDXVHVWKHpricesWR
stabiliseDQGSHUKDSVHYHQFRPHGRZQ

 The Reserve Bank and the exchange rate

7KH5HVHUYH%DQNFDQDOORZWKHUDQGWRGHFUHDVHLQYDOXHGXHWRLQWHUQDWLRQDOPDUNHW
IRUFHVLQRUGHUWRLPSURYHH[SRUWV

 The Reserve Bank and the repo rate

7KHDPRXQWGHSRVLWHGLQDEDQNGXULQJDQ\RQHGD\LVXQOLNHO\WREHHTXDOWRWKHDPRXQW
RIPRQH\WKDWDEDQNOHQGVRXWHJ%XVLQHVVHVDQGSHRSOHGHSRVLW5PLOOLRQLQRQH
GD\%DQNVJLYHRXWORDQVDQGRYHUGUDIWVRI5PLOOLRQGXULQJWKHFRXUVHRIWKHVDPH
GD\7KLVUHVXOWVLQDVKRUWDJHFDOOHGD³money market shortage´RI5PLOOLRQ7KH
EDQNZLOOKDYHWRborrowWKLVdifferenceIURPWKHReserve Bank

7KH5HVHUYH%DQNZLOORIIHUcreditWREDQNVWRcover the shortage7KHinterest rateWKDW

WKH5HVHUYH%DQNZLOOFKDUJHIRUWKLVcreditLVUHIHUUHGWRDVWKHRepo (purchase) rate

7KHUHSRUDWHfluctuatesIURPWLPHWRWLPHLQUHODWLRQWRWKHsupplyDQGdemandIRU
credit:KHQWKHUHLVtoo much demandIRUFUHGLWWKH5HVHUYH%DQNincreasesWKHUHSR
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&RXQWU\ 5HSRUDWH
6$ 
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(XURSH 

44
1.5 Other functions of the Reserve Bank
1.5.1 Financing for the various government projects would be withdrawn from the
Reserve Bank e.g. Water or housing projects.
1.5.2 Donations from foreign countries would be deposited into the Reserve Bank.
e.g. Swiss government donating R 20 million to HIV and Aids orphans.
1.5.3 All taxes collected by the South African Revenue Services will be deposited into the
Reserve Bank, e.g. VAT and income tax.
1.5.4 Social grants would be paid by Provincial government from the Reserve Bank e.g.
Pension & disability grants.

2.1 The Reserve Bank is one of only nine privately owned central banks.
Shareholders are limited to 10 000 shares each and are allowed one vote
for each 200 shares they hold. Shareholders include banks and other large
corporations, as well as individuals.
2.2 The bank, which was founded in 1921 and listed on the JSE in 1922, delisted in
2002. Shares are traded privately. After payments to reserves and dividends
of 10 percent of paid-up capital, surplus earnings are paid to the government.
As dividends are negligible*, the incentive for owning shares is that they give
shareholders access to documents and data not readily available to the
public. Holding shares is also perceived as conferring prestige on the holder.
2.3 Provision is made for 14 board members, but at present there are 13, as the bank
has only two instead of three deputy governors. The governor and deputies are
appointed by the president of South Africa, and the governor is the chairman
and chief executive.
2.4 The bank is responsible for monetary policy and acts as the government’s
banker. It is the custodian of the banking sector’s cash reserves as well as
the country’s foreign reserves.

*negligible - minimal

3. Services on offer by banks (DTI’s) include:

3.1 Short and long term insurance
3.2 Wide variety of investment options, including unit trusts
3.3 Wills and estate planning
3.4 Personal financial advice
3.5 Small business support and advice

8. Who is the Current Governor of

The Reserve Bank?
____________________________

45
46
 THE FLOW OF MONEY

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*LYHORDQV RYHUGUDIWVSD\LQWHUHVWRQGHSRVLWV :LWKGUDZDOV

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GOVERNMENT
LOCAL LEVEL
:LWKGUDZPRQH\IRUH[SHQVHV
 QRWHV

https://www.youtube.com/watch?v=6sM3KOYPL_A

48
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PRESENTATION

ACTUAL MARK TOTAL : 40

% ASSESSMENT : 6
LEVEL
DUE DATE:
:LWKWKHDLGRIWKHGLDJUDPSURYLGHGH[SODLQWKHIROORZLQJLQZULWLQJDQGLQSRLQWIRUP

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*RYHUQPHQW

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*RYHUQPHQW

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49
50
 THE ROLE OF SAVING AND INVESTMENTS IN THE ECONOMY

1. Financial institutions and the circular flow of income and spending

Financial institutionsLQFOXGH

‡ BanksVXFKDV6WDQGDUG%DQNDQG1HGEDQN
‡ Insurance companiesVXFKDV2OG0XWXDODQG6DQODP
‡ Pension fundsVXFKDV,VFRU3HQVLRQ)XQGDQGWKH
‡ Johannesburg Stock exchange (JSE)

7KHVHLQVWLWXWLRQVDUHQRWGLUHFWO\LQYROYHGLQWKHSURGXFWLRQRIJRRGV&ROOHFWLYHO\WKH\
DUHUHIHUUHGWRDVWKH³)LQDQFLDO6HFWRU´RIDQHFRQRP\

 Savings (Household and Firms*) and investment spending (Firms)

HouseholdsDQGfirms do not spendDOOWKHLUincomeGXULQJDparticular periodSome

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WKHUHLVDleakage or withdrawal from the circular flow of income and spending.
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depositsZLWKbanks.7KHVHfundsDUHWKHQavailable to firms that wish to borrow to
expand their productive capacity.Firms expand WKHLUSURGXFWLYHFDSDFLW\E\
purchasing capital goods VXFKDVmachineryDQGequipment7KLVLVFDOOHG
investment spending.:KHQEXVLQHVVHVSXUFKDVHFDSLWDOJRRGVLHZKHQWKH\LQYHVW
WKHUHLVDQaddition or injection into the circular flow of income and spending.
)LUPV %XVLQHVVHV
7KHmajor function RIWKHfinancial sector LVWKHUHIRUHWRDFWDVDIXQQHOWKURXJKZKLFK
saving can be channeled back into the circular flow in the form of investment
spending.

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6SHQGLQJ

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receive
income
IRUODERXU
6DYLQJ

Households

51
 The circular flow of income and spending within an open economy

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IRXUVHFWRUV
‡ 6SHQGLQJE\householdsRQFRQVXPHUJRRGVDQGVHUYLFHV
‡ 6SHQGLQJE\firms RQFDSLWDOJRRGVLQYHVWPHQWVSHQGLQJI
‡ 6SHQGLQJE\governmentRQJRRGVDQGVHUYLFHVG
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minus WKHVSHQGLQJE\South Africans RQimported goods.Z)

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S VDYLQJVZKLFKUHIHUVWRLQFRPHQRWVSHQW

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spendingLQDQeconomy
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 How the lack of saving affects an economy

 'XULQJDSHULRGRIfull employment WKHUHLVDJHQHUDOsense of optimismDQG
SHRSOHDUHreluctant to save.7KLVincreases demandDQGWKXVinflation.
 Low interest rates FDXVHSHRSOHWRbuy goods on credit DQGWDNHRXWloans,DV
WKHrepayments are affordable.7KHUHLVDQincrease LQmoney supply.
 %HFDXVHcontinued spending FDXVHVinflation, government KDVWRDSSO\
restrictive monetary policy HJLQFUHDVLQJinterest ratesZKLFKPDNHVFUHGLW
PRUHH[SHQVLYHDQGGHWHUVSHRSOHIURPPDNLQJPRUHGHEWDQGfiscal policiesVXFK
DVincreasing taxes7KHVHSROLFLHVWHQGWRreduce total demand DQGKHQFH
prices ZLOOstabilise or decrease DQGVRZLOOinflation.
 ,IDFRXQWU\KDVDhigh inflation rate, LWEHFRPHVglobally less competitive. ,WV
exports DUHreduced DQGLWKDVWRcut production,ZKLFKUHVXOWVLQ
retrenchments.
 :LWKDQincrease in the inflation rate, money loses its purchasing powerWKDWLV
PRQH\EX\VOHVVWKDQLWXVHGWR:KHQWKLVKDSSHQVSHRSOHcannot maintain WKHLU
standard of living DQGWKXVdemand higher wages. Higher wages increase
production costs, which result in higher prices.
 &KDQJHVLQSULFHOHYHOVZRXOGQRWEHDSUREOHPLIVDODULHVLQFUHDVHGLQSURSRUWLRQWR
SULFHVDVSHRSOHZRXOGVWLOOEHDEOHWRPDLQWDLQWKHLUVWDQGDUGRIOLYLQJPrices
however increase faster than wages.

52
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54
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WRITTEN AND ORAL PRESENTATION '$7(

ACTUAL MARK TOTAL : 50

% ASSESSMENT : 7
LEVEL DUE DATE:

ACTIVITY

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Topic: Savings culture of South Africans

<RXUVSHHFKPXVWKDYHan introduction, body

DQGconclusion
15:28
 <RXPXVWLQFOXGHWKHpositive effectsRIWKHLU
savingsRQWKHIROORZLQJ

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Presentation WRVKDUH0XVW SUHVHQWDWLRQ SUHVHQWDWLRQ SUHVHQWDWLRQ
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Presentation OLWWOHRUQR SDUWLDO FRQVLGHUDEOH XQGHUVWDQGLQJRI
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55
notes

56
 THE ECONOMIC CYCLE

 7KHeconomic cycle LVWKHrecurring UHSHDWLQJIDLUO\predictable

JHQHUDOpatternRIperiodicF\FOLFfluctuations ZKLFKDUHmeasured E\
WKHGross Domestic Product (GDP)

*'3 7KHPRQHWDU\YDOXHRIDOOJRRGVDQGVHUYLFHVSURGXFHGLQDQHFRQRP\
ZLWKLQDFRXQWU\¶VERUGHUVRYHUDSHULRGRIWLPH

 7\SLFDOO\DOOPDUNHWHFRQRPLHVUHSHDWHGO\PRYHWKURXJKWKHIRXUVWDJHVRI
WKHHFRQRPLFF\FOH7KHIRXUVWDJHVDUH

Expansion±*URZWKLQ*'3
Peak±+LJKHVWOHYHORI*'3
Recession)DOOLQ*'3RYHUWZRFRQVHFXWLYHTXDUWHUV
Recovery ±*'3RIDDQHFRQRP\VKRZLQJJURZWKDIWHUDUHFHVVLRQ

7KHHFRQRPLFF\FOHLVFKDUDFWHULVHGE\SHDNVDQGWURXJKV
ECONOMIC ACTIVITY

/RQJ7HUP7UHQG
A complete business cycle from one
% trough (point A) to the next trough
&
(point C). The cycle describes a
pattern of fluctuation around the long-
term trend. After the trough there is an
upswing, indicated by AB in the figure.
The peak is reached at point B,
$ followed by a downswing from B to C.
 TIME
 $5HFHVVLRQ

$recessionLVDnatural partRIDQeconomic cycle,QHFRQRPLFVWKH

UHFHVVLRQVWDJHRIDQHFRQRP\LVDgeneral slow downLQeconomic activity
over a period of time:KHQDFRXQWU\¶VGDP fallsIRUDWOHDVWtwo successive
quartersWKHQWKHFRXQWU\¶VHFRQRP\LVFRQVLGHUHGWREHLQUHFHVVLRQ
2QHTXDUWHU PRQWKV

 7KHFDXVHVRIWKHUHFHQWUHFHVVLRQLQ$PHULFD

BanksLQ$PHULFDOHQWPRQH\WRKLJKULVNERUURZHUVDWKLJKLQWHUHVWUDWHV
7KLVLVFDOOHG³reckless lending´7KHLQWHUHVWUDWHVZHUHQRW³IL[HG´DQGZHUH
LQFUHDVHGE\WKHEDQNVRYHUWLPH7KHborrowers defaultedRQWKHLUpayments
DVWKH\FRXOGQRWDIIRUGWKHP

57
7KHbanksLQ$PHULFDDUHQRZWRRVFDUHGWROHQGPRQH\,WLVQRWHDV\WR
JHWFUHGLWDQGWKHLQWHUHVWUDWHVIRUFUHGLWDUHDOVRYHU\KLJK7KLVLVFDOOHGD
³credit crunch´

7KHhigh pricesRIcrude oilDQGWKHwarLQ,VUDHODQG*D]DKDYHDOVR

FRQWULEXWHGWRWKHUHFHVVLRQ

7KHAmerican Reserve Bankoversupplied DollarsLQWRWKHHFRQRP\

WKHUHIRUHdevaluingWKH'ROODURQWKHLQWHUQDWLRQDOPDUNHWV

 (IIHFWVRIWKHUHFHVVLRQLQ$PHULFD

7KHAmerican Federal GovernmentKDVJLYHQPDMRUEDQNV³bailout´

SDFNDJHVZRUWK%LOOLRQ'ROODUVRIWD[SD\HUV¶PRQH\

7KHWZRindustriesWKDWKDYHEHHQKLWWKHKDUGHVWE\WKHUHFHVVLRQDUHWKH
property DQGPRWRUvehicleLQGXVWULHV

7KHUHKDVEHHQDVWHHSdeclineLQWKHhousing market:LWKWKH
GHYDOXDWLRQRISURSHUWLHVKRPHRZQHUVILQGWKHPVHOYHVRZLQJWKHEDQNVPRUH
PRQH\WKDQZKDWWKHLUKRPHVDUHZRUWK

7KHmotor vehicle industryKDVDOVRVXIIHUHG&RQVXPHUVDUHQRWEX\LQJ

QHZFDUV7KLVLQGXVWU\KDVVHHQPDQ\job lossesGXHWRWKHGHFUHDVHLQ
GHPDQG

0DQ\companiesKDYHretrenched workersreducedWKHLUwork weekHJ

GD\ZHHNRUclosed downGXHWRGRZQWUDGLQJDQGORVVRILQFRPH

 5HFHVVLRQLQ6RXWK$IULFD

'XHWRWKHinterdependence RIFRXQWULHVLHLQWHUQDWLRQDOWUDGHWKH
UHFHVVLRQLQ$PHULFDKDVDIIHFWHGDOOWKHZRUOGV¶HFRQRPLHV7KH6RXWK$IULFDQ
HFRQRP\LVQRH[FHSWLRQ

6RXWK$IULFDKDVVHHQDslumpLQWKHvehicle industry VDOHVDUHGRZQE\

FRPSDUHGWRWKHVDPHSHULRGODVW\HDUFactoriesKDYHclosed downDQG
PDQ\people have lost jobs. 2YHUPLOOLRQSHRSOHDUHXQHPSOR\HG7KH
PDMRULW\RIMREORVVHVDUHLQWKHWUDGHPLQLQJFRQVWUXFWLRQPDQXIDFWXULQJDQG
DJULFXOWXUHLQGXVWULHV7KHKRXVLQJPDUNHWKDVWDNHQDGLYH7KHSURSHUW\PDUNHW
KDVVORZHGGRZQDQGPDQ\KRPHVKDYHEHHQUHSRVVHVVHG

7KHNew Credit Actprevented banks from lending as recklesslyDVWKH

EDQNVLQ$PHULFD7KH5HVHUYH%DQNGHFUHDVHGOHQGLQJUDWHVWRFRPPHUFLDO
EDQNVUHSRUDWH+RPH/RDQV0RUWJDJHVDQGYHKLFOHILQDQFLQJDUHOLQNHGWR
WKHVHLQWHUHVWUDWHVWKHUHIRUHFRQVXPHUVDUHSD\LQJOHVVPRQWKO\RQWKHLUORDQV
+RZHYHUpeople being taken to courtIRUnot paying their debtURVHE\
FRPSDUHGWRWKHVDPHSHULRGRIWLPHODVW\HDU

7KHReserve Banks Monetary policyRIdecreasing interest ratesLV

PHDQWWRHQFRXUDJHFRQVXPHUVSHQGLQJ7KHGHFUHDVHLQLQWHUHVWUDWHVKDVSXW
more money in the pockets of consumers6RPHconsumersDUHKRZHYHU
reluctant to spendWKHH[FHVVPRQH\+RXVHKROGVDUHQRWEX\LQJOX[XU\LWHPV

58
and are holding off buying clothing in season and rather waiting for end of the
season sales for example.

6.5. Due to the devaluing of the Dollar the value of the Rand has improved.
This affects our exports negatively as importers pay more for goods than they
did a year ago. E.g. $ 1 could buy R 13’s worth of goods then but now the same
Dollar only buys R10’s worth. There is also more competition on the global
markets.

6.6. Continued and prolonged strike action by the South African workforce has
a debilitating effect on production, productivity and profits of companies.
During recessionary times, companies can ill afford unrealistic salary increases
and crippling trade union demands. Workers on the other hand are struggling to
make ends meet with constantly increasing prices of goods and services.

https://www.youtube.com/watch?v=3d7aPQafR54

7. Economic recovery and expansion in South Africa

The economic cycle is just that, a cycle. The recession will not last forever.
There will be an upturn in the economy and with a recovery, comes prosperity
and expansion.

The following factors will lead to an increase in GDP therefore an upswing in the
economic cycle.

7.1. Local investment in infrastructure e.g. Transport systems such

as the Bus Rapid Transport System and Gautrain.
7.2. Increase in tourism due to world class events e.g. World Cup Soccer. The
GDP is expected to grow by R21.3 billion
7.3. Job creation due to increased tourism and in the building sector (Roads

59
DQGVWDGLXPV6NLOOVWUDQVIHUWRWKHVHZRUNHUVPDNLQJWKHPPRUH
HPSOR\DEOHRUDEOHWRVWDUWWKHLURZQFRQVWUXFWLRQFRPSDQLHVDIWHU
Good weatherHJJRRGUDLQIDOOZLOO\LHOGVXUSOXVFURSVIRUH[SRUW
DQGHOLPLQDWHWKHQHHGWRLPSRUWIRRGDWKLJKHUSULFHV
0RUHefficient use of resourcesVXFKDVHOHFWULFLW\
-REFUHDWLRQWKURXJKentrepreneurship(QWUHSUHQHXUVKLSLVRQHRIWKH
DQVZHUVWRLQFUHDVLQJHPSOR\PHQW0DQ\SHRSOHZKRORVHWKHLUMREVVWDUW
WKHLURZQEXVLQHVVHVDQGLQWXUQEHFRPHHPSOR\HUV,Q6RXWK$IULFDLWLV
UHODWLYHO\HDV\DQGLQH[SHQVLYHWREHFRPHDEXVLQHVVRZQHU
Lower input costsHJWUDQVSRUWIXHOFRVWV
Higher outputE\EXVLQHVVHJ,QFUHDVHGSURGXFWLYLW\
(YHQlower interest rates
Increased consumer spendingGXHWRORZHULQWHUHVWUDWHV
Stable workforceHJ/HVVVWULNHDFWLRQ
12 Banks relaxing their criteria regarding loansIRUFRQVXPHUVDQG
EXVLQHVVHV
Government works programmesHJJRYHUQPHQWHPSOR\VSHRSOHLQ
FRPPXQLWLHVWREXLOGKRXVHVURDGVDQGFRPPXQLW\FHQWUHV
Political stability
Reduction in crime

 7KHGLIIHUHQFHEHWZHHQD5HFHVVLRQDQG'HSUHVVLRQ

$prolonged recessionFDQGHWHULRUDWHLQWRDdepression$GHSUHVVLRQLVDQ\
HFRQRPLFGRZQWXUQZKHUHWKH*'3GHFOLQHVE\RUPRUH$UHFHVVLRQLV
OHVVVHYHUH

7KHUHLVDQROGMRNHDPRQJHFRQRPLVWVWKDWVWDWHV$UHFHVVLRQLVZKHQ\RXU
QHLJKERXUORVHVKLVMRE$GHSUHVVLRQLVZKHQ\RXORVH\RXUMRE

 7KH*UHDW'HSUHVVLRQRI

7KHGreat Depression of 1929VWDUWHGLQAmerica7KHVWDUWRIWKH

GHSUHVVLRQZDVRQWK2FWREHUNQRZQDVBlack Tuesday7KLVZDVWKH
GD\WKDWWKHVWRFNPDUNHWVDSODFHZKHUHSHRSOHFDQEX\DQGVHOOSRUWLRQVRI
EXVLQHVVHVWKHVHSRUWLRQVDUHFDOOHGVWRFNVLQ$PHULFDFUDVKHG3URSHUWLHVKDG
ORVWWKHLUYDOXHDQGWKHUHZDVDOVRDPDMRUGURXJKWLQ$PHULFD

60
Consumers lost their confidencein commercial banksDQGZLWKGUHZ
WKHLUGHSRVLWV7KHEDQNVKDGXQIRUWXQDWHO\OHQWRXWIRUHYHU\GHSRVLWHG
7KUHHWKRXVDQGVEDQNVFUDVKHG7KHFRQVXPHUVKRDUGHGWKHLUPRQH\SXWLWLQ
VDIHVRUXQGHUWKHLUEHGV

7KHAmerican Dollar was backed by gold7KH)HGHUDO5HVHUYH%DQNGLG

not have enough gold reserves to back the money that needed to be in
circulation. :KHQDFXUUHQF\LVEDFNHGE\JROGLWPHDQVWKDWPRQH\FDQEH
H[FKDQJHGDWWKH5HVHUYH%DQNIRUDFWXDOJROGRIWKHVDPHYDOXH3UHVLGHQW
5RRVHYHOWPDGHLWLOOHJDOWRSRVVHVVJROGDQGWKHgold standard was dropped
7KH'ROODUWKHQKDGSHUFHLYHGVXSHUILFLDODOOHJHGYDOXHUnemployment shot
up to 50%

(YHU\RWKHUmajor currencyKDGDOVREHHQbacked by goldDQGPDQ\

FRXQWULHVZHQWLQWReconomic depression7KHRQO\FRXQWU\WKDWPDQDJHGWR
HVFDSHWKHGHSUHVVLRQZDV&KLQDDVWKHLUFXUUHQF\ZDVEDFNHGE\VLOYHU7KH
OHQJWKDQGVHYHULW\RIWKHGHSUHVVLRQRIFRXQWULHVGHSHQGHGRQKRZVRRQWKH\
GURSSHGWKHJROGVWDQGDUG

,QGXHWRWKHWKUHDWRI1D]L*HUPDQ\DQGWKHHPLQHQFHRI
World War 2FRXQWULHVOLNHAmerica and Britain produced masses of arms
and ammunition WRILJKWWKHZDU

7KHPLOOLRQVROGLHUVZKRZHUHSUHYLRXVO\HPSOR\HGKDGWREHUHSODFHG
DQGfactories hired as many people as they could%XVLQHVVHVKLUHGHYHU\
SHUVRQLQVLJKWHYHQGULYLQJWUXFNVXSDQGGRZQVWUHHWVEHJJLQJSHRSOHWRDSSO\
IRUMREVThe Government spent fortunes on arms and ammunition
*RYHUQPHQWVSHQGLQJVWLPXODWHGWKHHFRQRP\$UPVZHUHGHPDQGHGLQYDVW
TXDQWLWLHVDVVRRQDVSRVVLEOHUHJDUGOHVVRIFRVW3URGXFWLYLW\VRDUHGDQGSHRSOH
ZHUHSUHSDUHGWRZRUNRYHUWLPHWRPDNHPRQH\DIWHUVRPDQ\\HDUVRIKDUGVKLS
7KHHQGRIWKHGHSUHVVLRQLQ$PHULFDHQGHGDURXQG7HQ\HDUVDIWHULWKDG
VWDUWHG

61
QRWHV

62
 ([SODLQVWKHGLIIHUHQWIORZVRIPRQH\
IDFWRUVRISURGXFWLRQJRRGVDQG
VHUYLFHVLQWKHHFRQRPLFF\FOHZLWKLQ
WKH6RXWK$IULFDQHFRQRP\
WORKSHEET - ANALYSIS

TOTAL : 67
ASSESSMENT : 8

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63
. $QDO\VHWKHFDUWRRQDQGDQVZHUWKHTXHVWLRQVWKDWIROORZ

64
 'LVFXVV7HQIDFWRUVWKDWZLOOFRQWULEXWHWR6RXWK$IULFD
VHFRQRPLFUHFRYHU\

58 - 59



.. 5HDGWKHUHFHQWQHZVSDSHUKHDGOLQHVRQWKHIROORZLQJSDJH
 5HZULWHWKUHHDUWLFOHKHDGOLQHVWKDWLQGLFDWHDrecessionLQ6RXWK$IULFD8VH
WKHVSDFHSURYLGHG

65
66
 3. Discuss whether South Africa is currently in recession, recovery or depression.
Substantiate you answer with 6 reasons why.

3. Since 2009, do youthink that our economy has recovered or is it still in recession?Substantiate your
answer with reference to 6 (six) factors that contribute to economic recovery.
Any 6 of the 15 factors listed below with an explainantion
1. Local Investment
2. Increase in Tourism
3. Job Creation
4. Good weather
5. Efficient use of resources
6. Entrepreneurship
7. Lower inout costs
8. Higher outputs
9. Lower Interest rates
10. Increased consumer spending
11. Stable workforce
12. Banks relaxing their criteria regarding loans
13. Government works programmes
14. Political Stability
15 Reduction in crime

( 12)

67
68
68
 NATIONAL INCOME

7KHmain source of government revenueLQFRPHLVtaxes

7KHUHDUHtwo Tax systemsQDPHO\Progressive Tax7D[HVRQIncome)DQG

Regressive Tax7D[HVRQ&RQVXPSWLRQ

 ([DPSOHVRIProgressive (Income)7D[DUH

 Personal Income TaxLVWD[HVSDLGRQsalaries and wages7KHKLJKHUWKH

LQFRPHWKHKLJKHUWKHSHUFHQWDJHWD[
 Company TaxLVWD[HVSDLGE\FRPSDQLHVRQWKHLUprofits
 Capital Gains TaxLVDWD[SDLGRQWKHprofitsPDGHE\WKHsellingRIassets
HJKRXVHVDQGYHKLFOHV

 ([DPSOHVRIRegressive (Consumption)7D[DUH

 Value Added Tax9$7ZKLFKLVSDLGRQPRVWgoodsDQGservicesDWDUDWHRI

15%. %DVLFIRRGVVXFKDVEURZQEUHDGPDL]HIUXLWDQGYHJHWDEOHVDUHQRW
WD[DEOH
 Customs dutiesDUHWD[HVSDLGRQimported goods
2.3 Excise TaxDUHWD[HVSDLGRQluxury itemsVXFKDVFLJDUHWWHVDQGDOFRKRO

 2WKHUVRXUFHVRI5HYHQXHLQFRPHLQFOXGH

 ,QFRPHJHQHUDWHGE\WKHsale of state (government) owned assets and
businesses
 Profits generated by state owned businessesHJ6RXWK$IULFDQ$LUZD\V
 Sale / rental of State owned land or buildings
 )HHVVXFKDV licensing fees

69
 &ROOHFWLRQRIWKH5HYHQXHE\WKH6RXWK$IULFDQ5HYHQXH6HUYLFHV

7KHSouth African Revenue Services6$56LVDGPLQLVWUDWLYHO\ autonomous

(independent)RIWKHVWDWH7KH6RXWK$IULFD
VWD[V\VWHPLVVHWE\WKH1DWLRQDO7UHDVXU\
DQGLWLVmanagedE\6$56

7KHPDLQIXQFWLRQVRI6$56DUHWR

 CollectDQGadministerDOO National Taxes, duties and levies

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RXUFRXQWU\7KH&XVWRPVGLYLVLRQZRUNVWRIDFLOLWDWHWUDGHDQGPDNHLWSRVVLEOHIRU
FRPSDQLHVDQGLQGLYLGXDOVWRtradeLQDQefficientDQGlegalZD\&XVWRPVDOVR
negotiatesDQGPDLQWDLQVIUHHtrade agreementsVXFKDVZLWKWKH(XURSHDQ8QLRQ
DQG6RXWKHUQ$IULFDQ'HYHORSPHQW&RPPXQLW\6$'&<RXFDQUHDGWKHRULJLQDO
WUDGHDJUHHPHQWVRQWKHZHEVLWHZZZVDUVJRY]DDQGIROORZWKH³FXVWRPVDQG
H[FLVH´OLQN
 AdviseWKHMinister of FinanceRQDOOrevenue matters

 7KHGLIIHUHQFHEHWZHHQD7D[DQGVXEVLG\

$TaxLVDcompulsory contributionSDLGE\WKHFLWL]HQVRIDFRXQWU\WRWKHJRYHUQPHQW
HJ9$7,QFRPH7D[5DWHVDQG7D[HVHWF:KHUHDVDsubsidyLVZKHQWKHgovernment
assistsWKHFLWL]HQVE\SD\LQJIRURUDEVRUELQJDSRUWLRQRIWKHFRVWRIVSHFLILFJRRGVDQG
VHUYLFHVHJEUHDGHGXFDWLRQDQGPHGLFDOVHUYLFHV

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70
 *7+(%8'*(78VXDOO\DWWKHHQGRI)HEUXDU\WKH0LQL

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:KRLVWKHFXUUHQW
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BBBBBBBBBBBBBBBBBBBBBBBBBB Thembekile Kimi Makwetu

Auditor-General of South Africa

71
notes

72
 People's Guide ISSUED BY

RSABUDGET2020
ENGLISH

Tel: (012) 315 5757

www.treasury.gov.za RSA Budget #RSABudget2020 A joint publication between National Treasury and South African Revenue Service www.treasury.gov.za

WHAT IS THE BUDGET HOW IS THE BUDGET PUT TOGETHER?

7. Finally allocations are decided in Cabinet
INFO

In February of each year, the Finance Minister tables the national
budget, whereby he announces government’s spending, tax and
borrowing plans for the next three years. The national budget
divides money between national departments, provinces and
municipalities.
1. Departmental guideline is issued indicating budget
information required
2. Departments prioritise their programmes, compile
spending plans and service delivery commitments
3. Budget proposals are submitted to treasury and deliberated on
4. Allocation proposals are considered by Interdepartmental
committees of Directors-General
5. Budget recommendations are made to Ministers’ Committee
6. Medium Term Budget Policy Statement signals the
upcoming Budget
8. Budget documents are prepared
9. Main Budget is tabled
10. Parliament deliberates and adopts a Budget
11. Sent to the President for signing into Law

SOUTH AFRICA'S FISCAL

DEFICIT AND RISING DEBT
T South Africa needs structural reform
he public finances are in sufficient. In preparing the 2020
an unsustainable position. Budget, government considered but
Government is spending that will ensure much faster economic decided against raising additional
more than the economy can afford, tax revenue. The main factors in this
and borrowing at an increasing rate growth, in order to sustainably grow decision were the weakness of the
to fund the shortfall. economy. Government’s short-term
the tax revenue that pays for social and focus is to rebuild the capacity of
Since the 2019 Medium Term SARS and the public’s trust in the
Budget Policy Statement (MTBPS), developmental programmes. institution.
the economic environment has
deteriorated, and GDP growth has South Africa needs structural reform
been revised down to 0.3 per cent in Africa would face an inability to fund To avert this situation, government that will ensure much faster economic
2019. Revenue projections have also government’s social and economic aims to reduce the public-service growth, in order to sustainably grow
been lowered. Spending pressures programmes; mounting debt costs wage bill, resulting in total savings the tax revenue that pays for social
have continued to mount, especially and interest rates; weakening of approximately R160 billion over and developmental programmes. The
as a result of financial distress in state- confidence, translating into the next three years. This reduction most pressing reform is to ensure that
owned companies. lower investment and still weaker should also improve the quality of all businesses and households have
economic growth, worsening the spending, by creating more space for sufficient and dependable electricity
The 2019 MTBPS warned that the employment crisis; ballooning spending on goods and services and supply. Over time, higher economic
consequences of not acting to government debt; and an economy infrastructure investments. growth would reduce fiscal pressure
restore sustainable public finances that is unable to respond to global by increasing revenue collection and
would be profound. Over time, South shocks. On its own, this intervention is not reducing South Africa’s debt levels.

73
NATIONAL TREASURY #RSABUDGET2020 | A PEOPLE’S GUIDE TO THE BUDGET 1
ENGLISH | A PEOPLE’S GUIDE TO THE BUDGET
MESSAGE
FROM THE
MINISTER
S T
outh Africa’s finances are at
a very precarious position.
There are increasing demands
and not enough resources.
Spending has to be maintained, and at
times has had to increase due to rising
social responsibilities, while revenue
collection has underperformed,
resulting in increased government
borrowing.
Drastic and out-of-the-box thinking
is needed urgently, but will require
an all-hands-on-deck approach by
government, labour, business and civil
society. South Africans are growing
increasingly impatient with how
government is spending, particularly
over the use of taxpayers’ money
to financially support state owned
companies as they work towards self-
sustaining financial positions.
The 2020 Budget makes provision
for a continuation of spending on
government’s key social programmes,
such as social grants, health and basic
education. The Budget also proposes
several measures that should be taken
to spend more efficiently. We are
working toward reigning spending,
and improving the lives of our people.
We are working towards a society
that will create more employment
opportunities and curb wastage.
I urge South Africans to be resilient
in the face of these challenges and
hope against hope that it will get
better. Lastly, let me end with a quote
from Mike Rawlings which says: “It
may get worse before it gets better,
but it will get better.”
2 #RSABUDGET2020 | A PEOPLE’S GUIDE TO THE BUDGET
| NATIONAL TREASURY
THE IMPACT OF ELECTRICITY SHORTAGES
ON THE ECONOMY
he economy is estimated to Programme has been allocated an 3 000 MW of power, and is reviewing
have grown by only 0.3 per additional R16.4 billion to fund about schedule 2 regulation amendments
cent in 2019. Since the 2019 560 000 new connections to the that facilitate self-generation.
MTBPS, the projections have been power grid over the medium term. Government has promulgated
revised down to 0.9 per cent in 2020, Additional 15 000 households will Section 34 determinations making
rising to just 1.6 per cent in 2022. be provided with stand-alone power it easier for municipalities to buy
system connections per year. Over electricity from independent power
Electricity shortages are expected the medium term, government will producers (IPPs).
to constrain growth in the next few transfer R15.7 billion to municipalities
years. Government is working towards and Eskom to fund this programme. Efforts are under way to speed up the
resolving the electricity shortage provision of electricity from renewable
challenge. Over the next three years, Government has begun to address energy IPPs and to procure emergency
energy expenditure is expected to economic growth constraints with power from those that are able to
total R150 billion, accounting for a a series of policy frameworks and deliver power to the grid within 3-12
fifth of total infrastructure spending. measures. The Department of Mineral months from approval. Existing IPPs
Resources and Energy is assessing are estimated to be able to produce
The Integrated National Electrification proposals to produce an additional about 200 MWs additional electricity.
STEMMING
VIOLENCE
AGAINST
WOMEN AND
CHILDREN
O
ver the medium-term,
government plans to
establish 58 new sexual
offences courts with prosecutors and
additional 5 Thuthuzela Care Centres.
The existing 46 backlog courts
will be utilised to prioritise and
clear the backlog of gender-based
violence and femicide cases. To
support programmes aimed at
preventing HIV and AIDS, substance
abuse, gender-based violence and
femicide, government will further
fund provincial departments of social
development.
74
 NATIONAL TREASURY | A PEOPLE’S GUIDE TO THE BUDGET | ENGLISH

SOCIAL GRANTS TO BENEFIT THE POOR

I
n 2020/21, government will
increase the child support grant
by R20 per month, the foster care
grant by R40 per month and the old
age grant by R80 a month.
The total number of beneficiaries
are expected to increase by almost
one million to reach approximately
19 million by 2022/23.
The child support grant reaches
the largest number of beneficiaries,
estimated at 13.4 million children.

SOCIAL GRANTS 2019/20 2020/21

STATE OLD AGE GRANT R1 780 R1 860
STATE OLD AGE GRANT, OVER 75 R1 800 R1 880
WAR VETERANS GRANT R1 800 R1 880
DISABILITY GRANT R1 780 R1 860
FOSTER CARE GRANT R1 000 R1 040
CITIES PROGRAMME CARE DEPENDENCY GRANT R1 780 R1 860

PROJECT PREPARATION CHILD SUPPORT GRANT R425 R445

FACILITY
T HOW WILL IT BE SPENT IN 2020/21
o fast-track the spatial
transformation of cities,
government will focus on
planning of well-located, mixed-use
and mixed-income development
programmes and projects for cities
and Urban Networks for secondary
cities. The government intends
to establish a Cities Programme
Project Preparation Facility (CIPPPF).
WHERE THE MONEY COMES FROM AND
The CIPPPF will be a dedicated
grant that supports large urban
municipalities to develop
effective and efficient programme GOVERNMENT SOURCES OF INCOME IN 2020/21
management and project preparation
practice for their capital investment
R1 425.4bn | 78% Taxes
programmes. It will aim at improving
the rate of spatial transformation and Borrowing
R 370.5bn | 20%
employment creation, thus reducing
poverty and inequality.
R 36.0bn | 2% Non-Tax Revenue

GOVERNMENT SPENDING IN 2020/21

R309.5bn - 15.8% Social Development

R 265.9bn - 13.6% Basic Education

R 229.7bn - 11.8% Health

R 229.3bn - 11.7% Debt-service Costs

R 217.0bn - 11.1% Peace and Security

R 212.3bn - 10.9% Community Development

R 211.5bn - 10.8% Economic Development

R 118.8bn - 6.1% Post School Education and training

GOVERNMENT NON-INTEREST
GOVERNMENT WORKING AND INTEREST PAYMENTS
WITH CIVIL SOCIETY AS A SHARE OF TOTAL EXPENDITURE
100

I
n 2018, the National Treasury from various countries to explore
95
collaborated with civil society further participatory mechanisms 10.9 11.2 11.7 11.7 12.3 13.2 14.0
in the development of the in budgeting. The 3-year pilot 90
Per cent

Vulekamali portal; an award-winning project aims to build capacity for

online portal that promotes budget implementation in the finance 85
transparency and public participation. ministries. An open invitation Non-interest
80 89.1 88.8 88.3 88.3 87.7 86.8 86.0
appealing interested participants to spending*
On the 2nd and 3rd of March join the project has been published 75
Interest payments
2020, the National Treasury will on National Treasury’s website and 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23
be hosting finance ministries social media platforms. * Non-interest expenditure is total spending by government excluding interest paid on debt.

75
#RSABUDGET2020 | A PEOPLE’S GUIDE TO THE BUDGET 3
ENGLISH | A PEOPLE’S GUIDE TO THE BUDGET | NATIONAL TREASURY

2020 TAX PROPOSALS

Personal Income Tax Tax Rates

HOW DO THE PERSONAL INCOME INCOME TAX: INDIVIDUALS AND TRUSTS

TAX CHANGES AFFECT YOU? Tax payable by individuals for the tax year ending between 1 March 2020 and
28 February 2021.
The 2020 Budget provides for real tax relief (more than inflation) by adjusting Taxable Income (R) Rate of Tax (R)
taxable income brackets and increasing personal income tax rebates. The
amount an individual can earn before being required to pay tax is adjusted as 0 to 205 900 18% of taxable income
follows for the tax year from 1 March 2020 to 28 February 2021: 205 901 to 321 600 37 062 + 26% of taxable income above 205 900

TAX THRESHOLDS TAX YEAR: 2019/20 TAX YEAR: 2020/21 321 601 to 445 100 67 144 + 31% of taxable income above 321 600
Below age 65 R79 000 R83 100 445 101 to 584 200 105 429 + 36% of taxable income above 445 100
Age 65 to 74 R122 300 R128 650 584 201 to 744 800 155 505 + 39% of taxable income above 584 200
Age 75 and over R136 750 R143 850 744 801 to 1 577 300 218 139 + 41% of taxable income above 744 800

The new tax rebates for individual taxpayers are as follows: 1 577 301 and above 559 464 + 45% of taxable income above 1 577 300

TAX REBATES TAX YEAR: 2019/20 TAX YEAR: 2020/21 Trusts other than Rate of tax 45%
special trusts
Primary (age below 65) R14 220 R14 958

Secondary (age 65 and over) R7 794 R8 199 INCOME TAX: COMPANIES

Tertiary (age 75 and over) R2 601 R2 736 Financial years ending on any date between 1 April 2020 and 31 March 2021.
Type Rate of Tax (R)
Sin Taxes Companies 28% of taxable income

INCREASES IN ALCOHOL INCOME TAX: SMALL BUSINESS CORPORATIONS

AND TOBACCO DUTIES Financial years ending on any date between 1 April 2020 and 31 March 2021.
Specific excise duties on alcoholic beverages and tobacco products will Taxable Income (R) Rate of Tax (R)
increase by between 4.4 and 7.5 per cent.
0 to 83 100 0% of taxable income

INCREASES BY: 83 101 to 365 000 7% of taxable income above 83 100

Malt beer 8c per 340ml can 365 001 to 550 000 19 733 + 21% of taxable income above 365 000

Unfortified wine 14c per 750ml bottle 550 001 and above 58 583 + 28% of the amount above 550 000
Fortified wine 23c per 750ml bottle
Sparkling wine 61c per 750ml bottle TURNOVER TAX FOR MICRO BUSINESS
Ciders and alcoholic fruit beverages 8c per 340ml can Financial years ending on any date between 1 March 2020 and 28 February 2021.
Spirits R2.89 per 750ml bottle 0 to 335 000 0% of taxable turnover
Cigarettes 74c per packet of 20
335 001 to 500 000 1% of taxable turnover above 335 000
Cigarette tobacco 82c per 50g
500 001 to 750 000 1 650 + 2% of taxable turnover above 500 000
Pipe tobacco 40c per 25g
Cigars R6.73 per 23g 750 001 and above 6 650 + 3% of taxable turnover above 750 000

Fuel Levies Transfer Duty

INCREASES IN FUEL LEVIES DECREASES IN TRANSFER DUTY

The general fuel levy will increase by 16 cents per litre and the Road Accident From 1 March 2020 adjusted rates apply to the acquisition of property.
Fund levy will increase by 9 cents with effect from 1 April 2020. This will increase:
• the general fuel levy to R3.70 per litre of petrol and to R3.55 per litre of diesel Value of property (R) Rate (R)
• the road accident fund levy to R2.07 per litre for both petrol and diesel 0 to 1 000 000 0% of property value
1 000 001 to 1 375 000 3% of property value above R1 000 000
Environmental Tax 1 375 001 to 1 925 000 11 250 + 6% of property value above R1 375 000
1 925 001 to 2 475 000 44 250 + 8% of property value above R1 925 000
INCREASE IN PLASTIC BAG LEVY 2 475 001 to 11 000 000 88 250 + 11% of property value above R2 475 000
The plastic bag levy will increase from 12c to 25c per bag on 1 April 2020. 11 000 001 and above 1 026 000 + 13% of property value above R11 000 000

76
4 #RSABUDGET2020 | A PEOPLE’S GUIDE TO THE BUDGET NATIONAL TREASURY
 NAME:
National Budget
GRADE:
DATA RESPONSE DATE:

ACTUAL MARK TOTAL : 60

% ASSESSMENT : 9
LEVEL DUE DATE:

Refer to RSA budget 2020 - People's Guide and answer the following

1. During which month is the National Budget tabled by the Minister of Finance? February ___________(2)
2. "The public finances are in an unsustainable position. Government is spending more than the
economy can afford, and borrowing at an increasing rate to fund the shortfall"
2.1 Is South Africa's finances in a healthy position? _______ No (1)
2.2 What is the main source of income for the Government? __________ Taxes (1)
2.3 Is government collecting enough taxes to cover its expenses? _________ No (1)
2.4 What measure is government taking to fund the shortfall? _______________________ (2) Borrowing
3. In the "Message from the Minister", he states that government uses tax payers money to fund
its companies that are not self sustaining.
3.1 Name one such state owned company ______________________________________
Eskom, SAA, Transnet etc. (1)
3.2 Do you think privatising these companies would help solve the problem? Substantiate your
answer.
__________________________________________________________________________
Learner's response
__________________________________________________________________________
e.g. Yes, government would no longer have to pay to keep these companies afloat .
_______________________________________________________________________
Government can then use our taxes for education, health and social services (4)
3.3 Which are governments 3 key social programmes _____________________________ (3) Health, Basic education and social grants
4. "Impact of Electricity Shortages on the economy" discusses how government is planning on
resolving the shortage of electricity. Elaborate on the following plans.
4.1 The Integrated National Electrification Program
__________________________________________________________________________
R16.4Bn has been allocated to fund 560 000 new connections to the power grid. An additional 15 000 households provided stand

__________________________________________________________________________
alone power per year.
________________________________________________________________________ (2)
4.2 Independent Power Producers (IPPS)
__________________________________________________________________________
Government is making amendments to section 34in order for municipalities to buy electricity from IPPS.
__________________________________________________________________________
Renewable energy will be procured from IPPS for emergencies.
________________________________________________________________________ (2)
4.3 How does power outages and load shedding affect the economy and why?
__________________________________________________________________________
Power outages prevent businesses from operating. Buinesses lose income and make less

________________________________________________________________________
profits and therfore pay less tax. No trading also means less VAT being collected. (2)
5. How is government planning on stemming violence against women and children?
________________________________________________________________________ (2)
5.1 In your opinion, what more should government do to stop violence against women and
children?
__________________________________________________________________________
Learners' response.
__________________________________________________________________________
e.g. Train police officers to handle victims with care and efficiency. To serve protection orders swiftly. Train educators
__________________________________________________________________________
and the community to assist abuse victims. Campaigns against women and children abuse. Support NGO's that support the cause.
_______________________________________________________________________ (4)
6. What is the aim of the Cities Programme Project Preparation Facility (CIPPPF)
___________________________________________________________________________
To improve the rate of spatial transformation and employment creation, thus reducing poverty and inequality

________________________________________________________________________ (2)
6.1 How much of the budget has been allocated to Community Development? __________ R212.3Bn (1)

77
7. What is the total number of beneficiaries of a social grant for 2020/21? 18 ________________
million (1)
7.1 How many children does the Child Support Grant reach? _________________________ 13.4 million (1)
7.2 What is the total cost of the Child Support Grant for 2020/21________________________R 5 963 000 000 (2)
8. "Where does the money come from?" Sources of Government Revenue include taxes, loans
and non-tax-revenue. Give an example of where non-tax-revenue. (Keep in mind that the
Government owns companies and assets such as buildings and land)
____________________________________________________________________________
Profits on state owned companies. Selling off of State owned land and buildings. Selling of State owned companies
____________________________________________________________________________
__________________________________________________________________________ (4)

9. Direct Taxes include:

9.1 Personal Tax - _______________
Income tax.
9.2 Micro Businesses - tax on ______________.
Turnover

9.3 Companies - Tax on ____________.

Income

10. Indirect taxes include:

10.1 ____________
VAT on goods and services at _____%
15

10.2 ______tax
Sin on alcohol and tobacco.
10.3 _________
Excise duties on import and export of goods.
10.4 The __________ and __________________________________
fuel Road Accident Fund levies on petrol and diesel.
10.5 __________________tax
Environmental on plastic bags.
10.6 ____________
Transfer duty on acquisition of property (Houses)
11. Calculate the transfer duty payable on a property valued at R 2 000 000. R
_______________
204 250
(12)
COVID STIMULAS PACKAGE

https://www.youtube.com/watch?v=Do0nXR__wfw

or 3:15

In April 2020, President Cyril Ramaphosa, made a statement that he was making a R5 Billion
stimulus package available in response to the social and economic devastation that the COVID
virus would have on the country.

12. No provision was made in the current budget for the unforeseen crisis, however R130 Billion
was redirected from the budget and balance was sourced from the ______________(Locally) UIF and
__________________________________________________________________(Globally).
IMF (International Monetary Fund) and World Bank (2)
13. The R5 Billion was to be spent on the following:
13.1__________________________________________________________________________
Health resources to respond to COVID

13.2 _________________________________________________________________________
Relief of hunger and social distress

13.3 _________________________________________________________________________
Support for companies and workers
13.4 _______________________________________________________________________
Phased reopening of the economy (4)
14. With regards to the health budget, discuss how the money was used to manage COVID.
_____________________________________________________________________________
Supply PPE to health workers, set up and improve capacity at screening/ testing stations,

_____________________________________________________________________________
Increase staffing at laboratories and hospitals. Purchase beds for fields hospitals being built.

_____________________________________________________________________________
Source suppliers for oxygen, ventilators and medicine etc.
_____________________________________________________________________________
__________________________________________________________________________ (4)

78
 NAME:
National Budget
GRADE:
DATA RESPONSE DATE:

ACTUAL MARK TOTAL : 40

% ASSESSMENT : 10
LEVEL DUE DATE:

1. Watch the video and answer the questions that follow. (Remember you can download the video
and watch off line to save data)

13:31

or

https://www.youtube.com/watch?v=mXA3ObGMEZo&t=374s

1.1How much did South Africa borrow from external funders? _______________________
R95bn (1)
1.2 Who is South Africa borrowing from?
_________________________________________________________________________
Borrowing Dollars from IMF, World Bank and New Development Bank (1)
1.3 At what interest rate is the IMF lending South Africa money? _____________________ (1)
1%

2. Watch the video and answer the questions that follow.

8:22

or

https://www.youtube.com/watch?v=7YJpcwvA9zs

2.1 What is a budget deficit? The __________________________________________________

shortfall between revenue and expenditure. (2)
2.2 How much of our total income will be used to service our debt in 2023? ______________ (1) 90.9%

2.3 What does it mean to "default" on a loan payment?

____________________________________________________________________________(2)
To not make a payment on the loan i.e. not honouring the loan conditions.
2.4 How is Government income affected by Covid/ lockdown with regards to:
Income Tax (Individuals): _________________________________________________________
Job losses mean people have less income therefore less income tax being collected by SARS
___________________________________________________________________________ (2)
Tax on Profits by companies:_______________________________________________________
Companies are struggling to make profits therefore taxes on profits on turnover and
___________________________________________________________________________
profits will drop (2)
VAT:_______________________________________________________________________ (2)
Fewer goods and services will be purchased therefore less VAT paid over to SARS
Fuel Levies: _________________________________________________________________
People are traveling less due to restrictions. Less fuel being used therefore lower fuel levies being collected by SARS (2)

2.5 Mention 2 institutions government borrows from locally and what is the benefit?
___________________________________________________________________________ (2)
2.6 South Africa is borrowing Dollars. If the value of the Rand decreases what will happen to the
amount owed? _______________________________________________________________
The amount owed will increase. (2)

2.7 How can the government save money with regards to State owned Companies? 4:50
___________________________________________________________________________
Sell State owned companies, public private partnerships, fight corruption within their companies. (2)
79
3. Watch the video and answer the questions that follow.

or

4:50
https://www.youtube.com/watch?v=58NPNHNFEyE

3.1 Why did the Minister of Finance table a supplementary/adjusted budget in June 2020?
__________________________________________________________________________
To respond to the Covid pandemic and a severe economic downturn (2)
3.2 What is the aim of the supplementary budget? The __________________________________
countries will loan each other money

__________________________________________________________________________
and to create a foundation for economic revival. (2)
3.3 How has Covid 19 affected our economy? ___________________________________ (2)
Our economy has contracted and we have a budget deficit

3.4 How has employment been affected by the pandemic? Unemployment _________________________
has risen (2)
3.5 What happened to revenue collection during the first few months of the pandemic?
__________________________________________________________________________
Projected collection R177.3Bn, actual amount collected R142Bn (Less revenue collected) (2)
3.6 What is the budget deficit in Rands? ________________________________________ (2)
R760Bn

3.7 What is the worst case scenario for the South African economy?___________________ Bankruptsy (2)
3.8 Why does Treasury have to re do the budget and what is this process called?
____________________________________________________________________________
Redo the budget (Zero based budgeting). Due to the budget deficit Government has to re prioritise spending and
_________________________________________________________________________
stabilise debt. (4)

80
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7KH$FWimprovesWKHfunctioningRIWKHCCMADQGTrade Unions and
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 RIGHTS AND RESPONSIBILITIES OF TRADE UNIONS

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ORGANISATIONS

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1.3. Choose one of the following women
• Mary Fitzgerald
• Linda Kompane
• Nise Malange
• Emma Mashinini
• Florence Matomela
• Poomoney Moodley
• Rahima Moosa
• Pauline Podrey
• Betty Radford
• Joey Scheepers

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notes

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119
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Logistics manager
Facilities manager

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Receiving Clerk
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goals of the business Accounts Clerk
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relationships with them Logistics manager
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purchases Distribution manager
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equipment
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8. Administrative Function Legal secretaries

Project managers
• Scheduling of meetings Secretary
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filing and faxing Administration assistant
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137
ACTIVITY Date: ___________________

9 . RISK CONTROL - Research the ninth Business Function.

Include:
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9.2 Job opportunities by looking for Jobs advertised in the newspapers and/or internet

Set out as per the previous 8 Business Functions i.e. in point form and with relevant
headings, pictures/drawings

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See the next page for links to Lere's Shoe Shine Business Website

CRITERIA 50 25 15
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http://www.shoeshine.co.za/

140
Topic: Interview with Lere Mgayiya

Time 6:32
https://www.youtube.com/watch?v=KY2BJSi1IIM

141
142
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4. SOCIAL RESPONSIBILITY
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ACTIVITY Date: _____________________

Design or paste a billboard advert showing an example
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Photo by Justin Hofman 2017

Topic: Informal waste collectors

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Sole Proprietors
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 THE FRANCHISE

$FranchiseLVDQagreementZKHUHE\one personZLWKDQexcellent product (franchiser)

sells WKH right to use WKH business name DQG sells LWV product or service WR another
person (franchisee) LQ accordance ZLWK various stipulations HJ corporation image
DQGproduct/service quality. A franchise can be registered as a Company.

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paysDcertain percentageRIWKH
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160
 $'9$17$*(6$1'',6$'9$17$*(62)7+()25062)2:1(56+,3
FORM OF
ADVANTAGES
OWNERSHIP
Sole 1. Simple to form i.e. No registration.
1 Owner 2. Can have an idea and start trading
immediately.
3. Ideas and changes can be implemented
immediately – no red tape
4. Don’t have to register for or charge VAT
(Unless turnover exceeds R 1000 000)
5. Could be a cash only business – Cash is
King
6. The Sole trader is able to offer his/her
clients a specialised service
7. Custom products can be designed for a
smaller customer base
8. Can run the business from anywhere with
limited resources and space within the
bylaws of the town or city.
9. All profit belongs to the owner
Partnership 1. Simple to form and there are no legalities
Minimum of 2 2. More than one person bringing resources
Partners, and expertise to the table
Maximum of 20 3. Shared responsibilities in running the
business
4. Share profit and losses
5. No need to draw up a Partnership
Agreement but it is better to have one
161
DISADVANTAGES
1. The Business is not a legal entity (A legal
person), therefore
the owner is responsible for all the debts
incurred for the business i.e. Unlimited
Liability
2. Financing is difficult to obtain
3. High Risk
4. Very demanding for one person to run the
business
5. Monthly income can vary considerably i.e.
Feast or Famine
6. The Sole Trader must manage his money
very well to provide for the leaner months
7. The Sole Trader may not be able to
compete with larger businesses that
benefit from wholesale prices, large
advertising budgets etc.
8. The Sole trader may not have all the skills
and knowledge needed for every aspect of
the business
9. Some companies will not trade with a
business that is not registered
10. The sole trader is taxed personally
11. There is no continuity i.e. when the owner
dies, the business ceases to exist
12. The owner may also not declare all income
generated to SARS which is Fraud
13. All losses suffered by the owner
14. The owner is taxed personally
1. The Business is not a legal entity therefore
the partners share unlimited liability
2. If there are more than 2 people then the
partnership may still exist between the
remaining partners
3. Can be open to fraud i.e. Partners not
declaring personal income from the
partnership to SARS (Cash Transactions
cannot be proven)
4. The owners are taxed personally.
5. One partner may work harder i.e. unfair
distribution of labour
6. If a Partnership dissolves, and there isn’t an
agreement, solving disputes are more
difficult. Legal council may be sought
7. If the partnership is also a friendship, this
too may also dissolve
 FORM OF
ADVANTAGES DISADVANTAGES
OWNERSHIP
Close Corporation 1. Limited Liability 1. New CC’s are no longer registered
CC 2. Legal Entity ( Business is held Liable for 2. Annual renewal of Registration with CIPC
1 – 10 Members Debts) required
CC 3. CC’s Registered prior to the New 3. Members are restricted to 10
Formed by Companies Act may still trade 4. Shelf CC’s are scarce
drawing up a 4. CC’s may still be bought 5. The CC is taxed the same as companies (On
Founding 5. Annual General Meeting (AGM) not Profit)
Statement. required
Members hold 6. No Audit required
interest. 7. Continuity – New Founding Statement
Members interest must be drawn up
is shown as a % 8. Can buy a Shelf CC ( Pre – registered CC’s
totalling 100% that never conducted business) to save
time and money
9. Raising Capital is easier than a Sole
Proprietor or Partnership

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162
A&7,9,7<

Tabulate advantages and disadvantages of a Sole Proprietor.

A&7,9,7<

Tabulate  advantages and disadvantages of a Partnership.

A&7,9,7<

Tabulate  advantages and disadvantages of a Close Corporation.

163
 FORM OF
ADVANTAGES DISADVANTAGES
OWNERSHIP
Private Company 1. Limited Liability for Shareholders 1. Many legal requirements (MOI and Notice of
PTY (Ltd) 2. Directors can be liable if they are Incorporation)
Formed by knowingly part of running the business 2. An AGM must be held
drawing up a MOI recklessly or fraudulently. 3. Company must be audited
and Completing 3. Continuity 4. Costs involved in registration
the Notice of 4. Transferring of shares from one 5. At least 1 Director required
Incorporation and shareholder to another is easy 6. Minimum of 2 shareholders required for a
Registering with 5. Raising Capital is easier meeting
the CIPC 6. Management can be more efficient 7. Shares may not be offered to the public to
Unlimited number 7. Can be adapted to small and large raise funds
of Shareholders. businesses 8. Cannot be registered on the stock exchange
1 or more 8. Annual Financial Statement do not have - JCE
Directors. to be filed with the CIPC i.e. the financial 9. Number of Shareholders limited
1 – 50 position of the Company is not public 10. Taxed on Profit
Shareholders hold knowledge
shares. 9. Certain expenses can be deducted as
business expenses e.g. Travel
10. Increased Credibility with customers,
suppliers and Financial Institutions
Public Company 1. Limited Liability of shareholders 1. Loss of Control due to Stock Market Rules
(Ltd) 2. Access to Public funding by selling shares 2. There are Market expectations so you
Listed on the 3. Shares can be used as Currency for cannot disappoint shareholders. (Increased
Johannesburg Acquisition (Buying Assets) Accountability)
Stock Exchange - 4. Giving shares to key employees can help 3. Founder Shares are diluted as new shares
JSE retain talent. are issued to raise capital.
Minimum of 3 5. Listed Companies increase their corporate 4. Market Volatility – Share prices rise and fall
directors reputation and public profile which due to reasons unconnected to the company
Unlimited enhances the brand name. e.g. Global issues whether real or perceived,
Shareholders 6. Company growth attracts Institutional change in government, strikes, disasters etc.
and Foreign Investors 5. Ongoing costs in maintaining the Listing
7. Being Listed can Facilitate Broad Based 6. Have to appoint an Investment Banker to
Black Economic Empowerment deals help with all the legal requirements and to
(BBBEE) create hype so as to attract investors.
7. Listing a Company can take 3 months – 2
years
8. Loss of Privacy due to media interest
9. Annual Financial Statements are Public
Knowledge (This could be an Advantage if
the Company is performing well)
10. Taxed on Profit

164
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165
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LIBERTYLIFE

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Tabulate 'LVDGYDQWDJHVRIDPublic and Private company.

166
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FORMS OF OWNERSHIP
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Cost of starting
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Financial
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Financial
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167
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168
 WHY A BUSINESS PLAN?

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169
 FORMAT OF A BUSINESS PLAN

1. COVER PAGE
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2. TABLE OF CONTENTS

3. EXECUTIVE SUMMARY
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170
 INDUSTRIES that gre w during COVID 19
"Never waste a good crisis" – Winston Churchill

1. eCommerce 6. Food

2. Supplements 7. Pet

3. Entertainment 8. Medical

4. Social Media 9. Home Improvement

5. eLearning 10. Cleaning & sterilising

171
Wamark Publishers © 2020
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ARE YOU A BORN ENTREPRENEUR?

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173
 BUSINESS PLAN

Criteria 0 1x5 2x5 3x5

1. Cover page A cover page is One of the The cover page meets The cover page meets the
1.1 Name of business not included in the requirements of a the basic requirements requirements. The cover page is
1.2 Name(s) of business owners business plan cover page is missing highly presentable and a great
1.3 Company Logo deal of effort has gone into
creating a professional impression
2. Table of Contents No table of contents A table of contents is included and
all pages are numbered correctly
3. Executive summary No executive summary One or more of the All the requirements of All the requirements have been met.
3.1 Name of business and owner/s requirements of an the executive The executive summary shows
3.2 Business address executive summary summary have been thought and thorough planning.
3.3 Type of business and form of ownership is missing met The layout is simple and easy to
3.4 Mission statement read. No unnecessary information
3.5 Reasons why the business will be successful
4. The business No information provided One or more of the All the requirements The nature of the business is fully
4.1 Business concept (Uniqueness of the requirements has have been met explained. The business concept is
business) not been met adequately realistic. The target market has
4.2 Target market been correctly identified. Suppliers
4.3 Supplier names and the goods/services supplied have been detailed.
173

5. Financial Plan No financial The projected Profit Both Capital & projected The projected Profit and Loss is
5.1 Capital - Source(s) and amount plan provided & Loss has not been Profit & Loss has been accurate i.e. Shows income and
5.2 Projected Profit and Loss included given. Some expenses (Fixed and variable) as
projections are per example. The projected profit/
unrealistic loss figures over three months are
realistic

6. Production Plan (Pages 187 - 190) _____/40 NAME: ______________________________

7. Marketing Plan
GRADE: ______________
7.1. Research Questionnaire (192 ) _____/30
DATE: _______________ DUE DATE:
7.2 Advertising (Pages 207 - 208 ) _____/80
TOTAL: 90
8. SWOT analysis (Page 195) _____/40 Sub Total _________/ 90 (B)
Sub total _____/190 (A) % Level _________
Grand total A+B = _____________/280
9. Conclusion No conclusion is given A concise summary of the
mission (goals) has been
included.
 BUSINESS PLAN MIND MAP
Activity - As you progress through the business plan summarise each part as a piece of the big puzzle.
174
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175
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products and services that satisfy the consumer.

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of marketing.

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offer and how it relates to the consumers needs and wants. This will include
warranties, guarantees and after sales support.

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education, publicity and personal selling. Branding refers to the various
methods of promoting the product, brand or company.

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including discounts.

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185
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186
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Types of questions
1. How do you rate the convenience of our location? (ranking)
poor good very good excellent

2. Please rank the following factors in the order of importance to you when making a buying decision for this service
(1 being most important, 5 being least important) (multiple choice & ranking)
price referral location availability guarantee other
3. Are there any other services you would like to see offered? (open ended)

4. Do you believe that our competitors’ prices are too high? (two choices) Yes No

5. What price would you be willing to pay for this product/service? (two choices) Note: This is an important question to ask
because the answer
will affect one’s sales revenue projections R10 - 20 R20 - 30
6. Which of the following services would you like to see offered? Choose one (multiple choice)
loans program mentoring counselling Research other

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or
https://www.brightvibes.com/791/en/repurpose-schoolbags-the-upcycled-solar-powered-backpack

or

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Questionnarie No.

Fieldworker
9. What do you dislike most about Glenvista
DAY Thur Fri Sat Centre?
1 2 3
1. How often do you visit Glenvista Centre?
Daily 2-3x/week Weekly 2x/month
1 2 3 4 10. Which local newspaper do you read
Monthly 3 Monthly 6 Monthly First Visit regularly?
5 6 7 8
2. Out of the last 10 visits to any large
shopping centre, how many of those were 11. What would you recommend should be done
to Glenvista Centre? to further enhance your shopping experience
at Glenvista Centre

3. How much time have/will you spend in the

centre today?
Minute DEMOGRAPHICS
Minutes
12. Gender of M F
4. Where do you live? (Suburb - if not in Respondent 1 2
greater Johannesburg, mention town city) 13. Age of respondent

14. Home language

5. How long does it take you to drive to this
centre from home? Afr Eng African European Other
1 2 3 4 5
Minute/s
15. Life Cycle
6. Where do you normally buy?
Shop Centre/Suburb Young (single/married, children pre-school) 1
Bulk groceries Full nest (children at school/live in) 2
Suppl. groceries Empty nest (older, children left home, 3
Clothing without children, widowed/divorced)

7. Which shops have you visited today? 16. What is your total monthly household income
Name up to 3) before any deductions (GROSS)?
7.1
7.2
Population A B C W
7.3 Group 1 2 3 4
8. What do you like most about Glenvista
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Tel No.:

192
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ACTUAL MARK TOTAL : 22

% ASSESSMENT NO: 25
LEVEL DUE DATE: _____________________

Question1.2
___________________________________________________________________________
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199
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Activity 1
1.1 Match up column A with B (There may be more than one match for column A)
1.2. Discuss five Threats that have presented themselves during the pandemic. Give an example of each.

Question 1.1 Column A Column B

a. Both Internationally & Locally. The tourism industry has been stunted.
1. Loss of lives

b. Loss of sin taxes which decreases government income.

2. Job losses & salary
c. Less or no income for households with no money to save.
3. Travel Ban
cuts
d. Lack of hospital beds, lifesaving equipment and staff.
4. Ban on sale of alcohol and cigarettes
e. Humans spread the virus. Wear your mask and sanitise.

5. Stressed Medical System

f. Formal & informal businesses closing down.

6. Bankruptcy & Liquidation g. Government prepared 1 500 000 graves.

7. International Trade has been curbed h. Higher prices for locally produced goods and services.
Answer sheet
1.
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5.
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200 ____/7
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the Coronavirus pandemic DATE:

ACTUAL MARK TOTAL : 22

% ASSESSMENT NO: 26
LEVEL DUE DATE: _____________________

Question 2.2
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Subtotal _____/15

201
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Activity 2
2.1. Match up column A with B (There may be more than one match for column A)
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a. Medical companies' JSE shares growing.
1. Software platforms that connect people
b. Business meetings, e-Learning & funerals can take place remotely.
2. Medical development
c. Local companies developing life-supporting machinery.
3. Scarcity of certain goods and services
d. Making masks at home.

4. Sell high, buy low

e. Companies are diversifying their products & services.

5. New opportunities for informal sector f. Buy while shares in stock prices have dropped.

6. New opportunities for formal sector g. Spending time with family and saving on travelling costs.

Answer sheet
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