Message from the MD - June 6 2023
Category Newsletter: Message from MD
MESSAGE FROM THE MANAGING DIRECTOR
Although a repo rate increase was expected in May, the second successive 50 basis point increase for this year was an unwelcome surprise. However, despite the fact that the hike was higher than expected, the current repo rate is still below the weighted repo rate average of 11,92% calculated between 1998 and 2023.
1998 marks the date on which I founded both Renico Plant Hire and Renico Construction. This was also the year where the repo rate peaked at an astonishing 23,99%! Now 25 years later our repo rate is less than half the historic high. While there are many other social and economic factors causing problems today, the chances are that we won't be seeing such high rates anytime soon.
As mentioned, Renico will be celebrating its 25-year anniversary this year. Just as the company was established during record high interest rates, we once again find ourselves in trying times. It is especially difficult to conduct business during weak economical times, but as all mainstays of industry know, business is cyclical and today is no different to 1998. The South African economy will stabilize again and once this happens; it will bring new opportunities to the fore. I for one am looking forward to the next 25 years in business, not only to build a stronger Renico but also to bring more quality housing to the South African market.
Author: Nico Louw
