S. Africa Companies Hoard Cash on ANC Policy Concerns

South African companies are hoarding near-record amounts of cash, hurting returns with interest rates at 30-year lows, as concern that President Jacob Zuma’s ruling party could push through policies that will cut profit hold back investments from miners like Gold Fields Ltd.

The African National Congress, facing protests over a 25.2 percent unemployment rate, starts a four-day policy conference on June 26 that will debate proposals to nationalize mines, banks and telecommunications companies, seize land without compensation and raise mine taxes. Europe’s credit crisis, slowing economic growth in China, local factories operating at below capacity and inadequate port, rail and road infrastructure are also forcing companies to sit back.