SIMON BROWN: I’m chatting now with Olga Constantatos. She’s head of credit at Futuregrowth Asset Management. Olga, I appreciate the early morning time. A recent note you wrote and a panel you were on, a Bloomberg panel, talked about the role of capital markets. You made a point which for me stood out – that the role of capital markets is not to revive economic growth or to improve investment sentiment.
OLGA CONSTANTATOS: One hundred percent, Simon. What we’ve found is that over the years that REIPPP was in play there was over R200 billion worth of capital invested in over 117 projects. That contributed significantly to adding a few thousand megawatts to the grid. So the supply of capital is very definitely there.
SIMON BROWN: Is that the sense? You mentioned those points there around price discovery and just the regulation and bits. Is it fair to say that broadly in South Africa we have the pillars in place for an efficient capital market, and that perhaps it’s more in certain areas where there’s weakness? Similarly in the electric-vehicle industry there’ve been similar delays around policy papers that get planned and presented for public comment, and then just don’t quite make it through all the internal government/cabinet/parliamentary, etc, processes that get delayed inexplicably.
OLGA CONSTANTATOS: Well, capital has to find a place, right? Our investors need a return. Certainly there are investment opportunities out there. It’s just a pity that if we had more of all the things I was talking about, if we had more of that we would be able to deploy much greater amounts of capital. The asset management industry speaks for over R3 trillion worth of people’s hard-earned savings. It’s your pension fund, your listeners’ pension fund, my pension fund.