<\/p>\n
You can also listen to this podcast on iono.fm here.<\/p>\n
SIMON BROWN: I\u2019m chatting now with Harry Scherzer. He is CEO at Future Forex. Harry, appreciate the early morning time again. Looking towards Europe, obviously we get the upsets coming out of the tariffs, the White House conflicts around trading partners.<\/p>\n
Europe is I think trying to stand up and take some of the slack. Are we seeing deepening engagement? I\u2019m thinking green hydrogen, critical minerals. Is there really a sort of strategic pivot or is this Europe more just sort of, I don\u2019t know, shopping for cheap?<\/p>\n
HARRY SCHERZER: Morning, Simon. great to chat to you again. Look, I think I think it\u2019s a bit of both. I think it\u2019s a matter of sensing desperation in South Africa with the Trump regime not inviting South Africa to the G20 Summit, and very openly showing hostility towards our government. So Europe is kind of picking up on, \u2018Well, that gives us a good opportunity to get in a little cheaper.\u2019<\/p>\n
Read:
Green hydrogen: An \u2018opportunity to completely reindustrialise SA\u2019
Trump threats risk stretching Europe\u2019s fragile unity to breaking point
EU eyes tariffs on \u20ac93bn of US goods over new Trump threat<\/p>\n
I think on the flip side it\u2019s definitely a good thing for us because it allows us to diversify away from our second-biggest trading partner being America, which at the moment, as I said, is very openly hostile towards us.<\/p>\n
And so it\u2019s good news that other countries in the West, in this case Germany, are happy to work with us, despite our geopolitical agenda very often being against theirs, and despite America openly saying they are not keen to have us at the G20 and they\u2019re not comfortable with the way we\u2019re acting.<\/p>\n
So ultimately I think this is a good thing for South Africa. It shows that it\u2019s less about the actual deal \u2013 it\u2019s not a massive deal \u2013 and more about the signal. It shows that Europe is willing to work with us in a time where we are not making that many friends.<\/p>\n
Read:
Germany pledges over R50bn to SA\u2019s Just Energy Transition
US urged France to revoke South Africa G7 invite, Pretoria says<\/p>\n
SIMON BROWN: I take your point. And to be clear, as much as we\u2019ve seen Trump in the White House sort of sabre-rattling towards us, he\u2019s doing it towards Europe.<\/p>\n
We have all forgotten Greenland; that was only about three months ago back at Davos. There is a realignment happening, and it would be clever and strategic for both parties to accept that and embrace it.<\/p>\n
HARRY SCHERZER: Absolutely. Trump has pretty much isolated America, saying \u2018America first\u2019, and by doing so he has shown that it\u2019s tough to work with America. Well, it\u2019s becoming tougher to work with America. They have always been a very, very easy nation to work with.<\/p>\n
And so you are right, this has other advantages for Europe, which basically realises it also needs to diversify. If we look at the idea of how oil currently, just to give an anecdotal point, oil has currently skyrocketed because of the Strait of Hormuz closing, opening, closing, and now closing again.<\/p>\n
As a result, Europe needs to find alternative sources for oil and this deal with South Africa provides these minerals, which can provide an alternative power to, for example, petrol \u2013 which requires oil.<\/p>\n
Read:
Oil and gas prices jump as strikes on gulf facilities escalate
\u2018Quiet-quitting\u2019 of US assets fuels boom in bets from EM to gold<\/p>\n
They are \u00a0effectively diversifying away from oil. Also, in terms of what we own, being the minerals, those are also hugely in demand right now with oil doing what it\u2019s doing. So you have a situation where Europe needs to diversify and they need our resources. This makes a whole lot of sense for them as well.<\/p>\n
SIMON BROWN: This is perhaps more about those resources, those minerals. We have all of them, and we have the critical ones, the green hydrogen \u2013 we have all of them. Europe does \u2013 more around the minerals. I\u2019m thinking back to all those negotiations around whether we could call it port or champagne and the like. This is minerals more than anything.<\/p>\n
HARRY SCHERZER0: Absolutely. And the way the deal is structured is \u20ac200\u00a0million is coming in as a loan in order for us to improve our infrastructure and be able to mine these minerals effectively. And then there\u2019s scope for another \u20ac270\u00a0million deal to actually have the minerals be used.<\/p>\n
Read: Sibanye secures green loan for Europe lithium project<\/p>\n
So in South Africa we have everything we need. What we don\u2019t have is a good utilisation ratio of funds. The reason for that is that our infrastructure just isn\u2019t in the place that needs to be. So I\u2019m happy to see this \u2013 but I really, really hope that we can use it to improve our ports, improve our railroads and improve our electricity, because these are the large infrastructure products that have for ages stalled us in our growth.<\/p>\n
Read:
How SA auto manufacturers can take advantage of global shifts
Green industrialisation \u2018the least-cost path to net zero for SA\u2019<\/p>\n
SIMON BROWN: And we need to get this working because, to be clear, Europe is not just talking to us. They are having this conversation with many other countries \u2013 I was going to say around the continent \u2013 but truthfully across the world. We need to grab it. We have the door open. We need to deliver to make sure it\u2019s us and not somebody else.<\/p>\n
HARRY SCHERZER: Look, the good news is there has been a lot of renewed growth in South Africa. We\u2019re off the grey list. We have the GNU, which has provided some stability.<\/p>\n
We\u2019ve had the rand strengthening. So I think the signs are positive in South Africa that we can actually grab this opportunity. But you are 100% right. If we let it falter, they are not going to sit around and wait for us. They are ultimately going to go elsewhere.<\/p>\n
Read: SA removed from another \u2018naughty list\u2019, this time by the EU<\/p>\n
SIMON BROWN: Yes. They want those minerals. They will find them. We have them. Let\u2019s hope that we can do it right. And certainly we have the opportunity. This is very possible, very real.<\/p>\n
We\u2019ll leave it there. Harry Sherzer, CEO Future Forex, appreciate the early morning time.<\/p>\n
Listen to the full MoneywebNOW podcast every weekday morning here.<\/p>\n
#Europe #minerals #oil #Deal<\/p>\n","protected":false},"excerpt":{"rendered":"
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