New market study, "South Africa Retail Report Q2 2013", has been published

The South African Retail Report examines the long-term potential of the local consumer market, but flags short-term concerns about the impact on South Africa's economic outlook of weakening in the already subdued domestic housing market.

The report examines how best to maximise returns in the South African retail market while minimising investment risk, and also explores the impact of serious headwinds from the global economy and potentially high investor risk aversion on the South African consumer and on the ability of producers and exporters to realise returns in the short term.

Full Report Details at
- http://www.fastmr.com/prod/589280_south_africa_retail_report_q2_2013.aspx?afid=301

The report also analyses the growth and risk management strategies being employed by the leading players in the South African retail sector, as they seek to maximise the growth opportunities offered by the local market.

South Africa comes first (out of seven) in BMI's MEA Retail Risk/Reward Ratings, although it underperforms for Risk.

Among all retail categories, mass grocery retail (MGR) will be the outperformer between 2013 and 2017 in growth terms, with sales forecast to increase by 46.5%, from.US$31.44bn to US$46.07bn by the end of the forecast period. In the competitive arena, BMI sees upside potential in the fact that South Africa's MGR sector is comfortably Africa's largest by value, while Walmart's imminent entry and commitment to focus mostly on food retail in South Africa highlights the sort of opportunities still on offer.

Over the last quarter, BMI has revised the following forecasts/views:

* BMI expects the South African economy to post sluggish growth over the medium term, forecasting that real GDP will expand by 2.8% in 2013 and 3.3% in 2014. Although private consumption should hold up fairly well, investment is likely to suffer due to elevated political risk.
* We remain fairly positive on private consumption, forecasting real growth of 3.0% in 2013 following estimated growth of 3.3% in 2012. In our view, two factors bode well for consumer spending: high nominal wage growth and the low interest rate environment which should keep a lid on debt servicing costs.
* The latest data on retail sales and credit extended to private households suggest that the consumer remains in decent shape in spite of indebtedness. Retail sales grew by 1.0% year-on-year (y-o-y) in October 2012, which is clearly anaemic but still respectable considering the extent of economic disruption that occurred that month due to industrial unrest. Meanwhile, credit extended to private households grew by a robust 9.3% y-o-y.

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