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2011 ended on a flat note, with investors anticipating a turbulent 2012 after the European Union prioritised austerity over growth. After an inconclusive EU summit which saw the UK isolated, German Chancellor Angela Merkel and French President Nicolas Sarkozy are to meet in January 2012 to discuss a new fiscal treaty. The only source of optimism was the US where the economic picture continued to brighten. Political uncertainty in Iraq, Syria and Russia added to the murky picture of the future.

The draft Taxation Laws Amendment Bill, 2011, is hereby published for comment. The draft legislation gives effect to matters presented by the Minister of Finance in the Budget Review 2011, as tabled in Parliament earlier this year.

Although no official document has been released, important announcements on social security reform have been made by government officials during the course of 2011. This note provides a summary of the latest social security reform developments.

All inward-listed shares – foreign companies trading on the JSE – will now be classified as domestic for exchange control purposes. This means they will also be included in JSE indices going forward.

CPI inflation for August came out lower than expected, at 5.3% y/y (5.5% y/y expected), driven by higher food and petrol prices. CPI inflation excluding food and non-alcoholic beverages, petrol and energy (core inflation) remained below the midpoint of the inflation target range, coming out at 3.8% y/y in August. The SARB will monitor it closely to gauge underlying demand driven inflationary pressures but with growth slowing, core inflation is unlikely to rise sharply in the coming months.”

Four years after the collapse of Lehman Brothers, panic once again gripped the financial markets as the European Union struggled to contain the sovereign debt crisis. Renewed signs of economic weakness globally and the downgrading of US debt by S&P rekindled concerns about the quality of all government debt. Amid summer holidays cut short for political leaders, social unrest in the UK, Hurricane Irene hitting the East Coast of the US and more violence in Syria and Libya, August brought back memories of the dark days of 2007.