The impact of the escalating global trade war is likely to shave 0.1% off South Africa's gross domestic product (GDP) baseline forecast in 2019 and 0.2% in 2020, according to Fitch Ratings' June 2018 "Global Economic Outlook" baseline forecast.
Fitch forecast that the escalation in the trade war is likely to reduce the world GDP by 0.4% in 2019 and by 0.3% in 2020.
"An escalation of global trade tensions that results in new tariffs on $2trn in global trade flows would reduce world growth by 0.4% in 2019, to 2.8% from 3.2%," the Fitch Ratings said in a statement on Wednesday.
The US, Canada and Mexico would be the most affected countries. Fitch expects China would be less severely impacted, with GDP growth around 0.3% below the baseline forecast. Fitch points out that China would only be affected directly by US protectionist measures, whereas the US would be imposing tariffs on a large proportion of its imports, while being hit simultaneously by retaliatory measures from four countries or trading blocs.
"The imposition of further tariff measures currently being considered by the US administration and commensurate retaliatory tariffs on US goods by the EU, China, Canada and Mexico would mark a significant escalation from tariff measures imposed to date," according to Fitch.
"The tariffs would initially feed through to higher import prices, raising firms' costs and reducing real wages. Business confidence and equity prices would also be dampened, further weighing on business investment and reducing consumption through a wealth effect."
Export competitiveness in the countries subject to tariffs would decline, resulting in lower export volumes. The negative growth effects would be magnified by trade multipliers and feed through to other trading partners not directly targeted by the tariffs. Import substitution would offset some of the growth shock in the countries imposing import tariffs.
Fitch forecasts that most countries not directly involved in the trade war would see their GDP falling below baseline, though generally at a much lower scale.
Net commodity exporters would be more severely hit, as slower world growth would push oil and hard commodity prices down. On the other hand, for some net commodity importers, the benefits from lower hard commodity prices would more than offset the impact of lower world growth.
Absa unveiled its new look on Wednesday, including a colour scheme that claims a wider spectrum of red. The bank has effectively been chained to the staid Barclays brand for more than a decade – so when Barclays ditched it, it decided to make deep changes.
Absa is even changing the voice that answers those who phone into its call centres, on top of 27,000 different forms and a total of some 500,000 "artefacts". Absa on Wednesday morning finally showed the world the new logo it has been so secretive about (although that leaked) and the colour scheme it will now be using (though that too leaked).
But in coming months customers will find changes to the massive bank's identity will run far deeper than that, down to the way it answers the phone.
Absa has recorded more than 10,000 individual items for the interactive voice systems used in its various call centres, says group marketing head David Wingfield.
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"We are going for a friendlier tone, with slightly younger voices and different intonation," he tells Business Insider South Africa.
Those recordings are on top of the 27,000 different forms Absa uses that will now have to be replaced – and the 345,000 branded pens, notepads, lanyards and pieces of clothing it had made to introduce the new look.
In total Absa will be replacing some 500,000 different "artefacts", says Wingfield, ranging from TV ads to the signs used inside branches.
Those changes will take some 10 months to complete, with three branches and 15 ATMs scheduled to be rebranded per day.
Using friendlier, younger voices alongside a more "digital" logo is all part of moving away from Absa's past, says Wingfield, which has kept its brand shackled for more than a decade.
British bank Barclays first moved in on Absa a decade ago, and it has not changed its look and feel since.
After Barclays dumped Absa in a shakeup of its global approach, the local bank decided it needed to leapfrog all the changes that had come to the world – and marketing – since then.
"The old Absa and Barclays were much more austere and serious," says Wingfield. "The world now is younger, digital. That's what we're trying to capture."
Along the way, Absa expanded its colour range around the "passion red" of its logo. Using everything from pink to orange "makes us more playful," says Wingfield, but it is also just sensible. Every cell phone and computer screen will display a slightly different shade of red anyway; trying to keep to a pure brand colour is a lost cause.
So Absa's logo button will always be either "passion red" on white, or white on red, but there will be many other warm hues in its branches and in some of its ads.
Including all the forms and all the signs used in some 620 branches scattered throughout the country.
With that kind of scale and spread there will be "something of a lag" until each instance of the Absa brand is updated, says Wingfield.
Source: The Insider