One of the reality of a falling rand value is that it brings great temptations, especially for exporters to enjoy the milk and honey of the windfall. Cees Bruggemans commentary brings some interesting insight.

For when the rains return, and the land once again overflows with milk and honey, it is a strong farmer who doesn?t start thinking of a new dress for the wife and a new Mercedes for himself. Suddenly all constraints appear to dissolve and deep urges to expand are stirring, now that credit lines open up again with a flourish.

Farmers went on a spree, and so did miners. Manufacturers also assumed indefinite support for their businesses. Cost increases weren?t resisted with the same vigour, and labour costs also rose as inflation reflected the higher import costs. Dividend payouts increased. And fixed investment jumped, often assuming that what otherwise would have been marginal propositions could now be depended upon to be sustainable.

Instead of mainly paying off debt, rigorously maintaining cost control and only conservatively expanding capacity, the 2001 windfall created many temptations that could ultimately not be resisted.

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So the big question really is, how do we, as business owners, manage to find the right balance between reaping the benefits and sowing for the future?

The last few lines say it well,

As to celebration, stick to clean water, while salting your windfalls away. They may last a while, but will probably evaporate quicker than you think possible.

In the process, you will do your country a great service, for we need to reduce the current account deficit, and this will be as much a matter of more balanced spending as greater production efforts across the board