All about business

South African manufacturing probably fell for a fifth consecutive month in February, possibly exceeding the previous month’s record decline, as the global recession slashed demand for exports, a survey showed.

Production tumbled 12.9 percent after dropping 11.1 percent in January, according to the median estimate of four economists surveyed by Bloomberg. The statistics office is scheduled to publish the data at 1 p.m. local time on April 8.

Manufacturers such as ArcelorMittal South Africa Ltd., Africa’s biggest steel producer, and Volkswagen AG, the country’s second-biggest automaker, have cut output and jobs as sales plunged. Factory output, which makes up 16 percent of the economy, may continue to contract as indicated by the Investec Purchasing Managers Index, which fell to a record low of 36 in March.

“It is virtually impossible to see a recovery in the manufacturing sector soon,” Danelee van Dyk, an economist at Standard Bank Group Ltd., Africa’s biggest lender, said in a note to clients. “Closure of many production facilities in April, for instance in the automotive and nonferrous steel sectors, will exacerbate production losses in the sector.”

Recessions in the U.S., Europe and Japan, which together take 60 percent of exports, have undermined manufacturing and contributed to the economy’s first contraction in a decade in the fourth quarter health insurance.

The Reserve Bank will publish foreign currency reserves data tomorrow. Gross reserves rebounded to $33.8 billion after the price of gold gained, the central bank said on March 6.

On April 8, the South African Chamber of Commerce and Industry will publish the business confidence index for March.

Market Rally

In political news, the National Prosecuting Authority is scheduled to announce its decision on whether to drop corruption charges against Jacob Zuma, leader of the ruling African National Congress, today. Zuma is the ANC’s presidential candidate for elections taking place on April 22.

Last week, the benchmark FTSE/JSE Africa All Share Index advanced 2.3 percent, with Investec Ltd. gaining 17.1 percent, the biggest increase of the top 40 companies in the index. Aspen Pharmacare Holdings Ltd. climbed 17 percent on speculation GlaxoSmithKline Plc is in talks with the largest maker of generic drugs in the southern hemisphere about buying a stake in the company.

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