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Holborn Assets offers investors a way out of South Africa’s financial crunch

16 September 2020 Holborn Management Services
Holborn Management Services Pty Limited

Holborn Management Services Pty Limited

· A popular webinar on the bleak economic outlook shows need for offshore wealth solutions
· Holborn Assets’ new office in Cape Town and adviser expansion positions the firm to offer new investment options

As South Africa grapples with a looming financial crisis and eroding investor confidence, Holborn Assets (Holborn) has expanded its capability in offering wealth management services locally.

The financial services firm, licenced by the country’s Financial Sector Conduct Authority (FSCA) since 2015, recently opened a new office in Cape Town. It now has around 30 advisers located onshore – roughly 50% more than 12 months ago.

Holborn expects to see a greater need – and take-up – of its services as the government increasingly struggles to fund an ever-widening fiscal deficit. In response, investor concerns over the stability of the currency, local banks and capital markets instruments are growing.

This was reflected in a poll taken during a live webinar which attracted 800 registrations, organised by the firm and hosted by RW Johnson, the acclaimed author, historian, academic and political analyst.

Of the 290 people who voted on where they see South Africa’s future in 10 years, 93% of respondents said it would, at best, be half-way between a Zimbabwe hyper-inflation scenario and a Singapore-style economic powerhouse. Notably, 57% of respondents predicted it will be far closer to the former in a decade’s time.

Access a recording of the webinar via this link

Running out of option

Entitled “How long will SA survive?”, the webinar explored the multiple fiscal challenges for South Africa.

Among various predictions, Johnson said he expects the country to face a debt crisis in 2021, possibly extending into 2022.

“South Africa has had a generation of ANC rule, but the ANC has failed to govern trustworthily,” he said. “We have seen six years of falling income and most state-owned enterprises are in a state of bankruptcy.

In Johnson’s view, the government must cut its spending immediately and sharply, and to a level that goes beyond simply lowering wages and salaries.

This is inevitably impacting both local and foreign investor appetite and comfort in South Africa. Amid such sentiment, there is a focus among individual investors on how to externalise assets, and quickly.

“Receiving 800 registrations and having 500 participants for this seminar reflects the growing concerns for South African residents and we look forward to helping allay those fears as we expand our operations to support our clients on the ground. We are also very proud of the work our team are doing especially with the opening of the new office in Cape Town, we have plans for a new office in Durban and plan to double the number of consultants over the next 12 months” says Robert Parker, CEO of Holborn Assets

Quick Polls

QUESTION

The intention with lockdown was to delay or flatten the Covid-19 infection curve and give both the private and public healthcare sectors time to prepare for the inevitable onslaught. Did the strategy work?

ANSWER

No, the true numbers are not reflected. Almost a quarter of South Africans may already have been infected with Covid-19
It’s too soon to tell. We will likely get a second wave with stringent lockdown regulations in place again
Yes, South Africa bought enough time to make a significant difference. We saved lives and have passed our peak. The worst is over
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