A LETTER FROM THE CHAIRMAN'S DESK

Dear Readers,

2025 – A YEAR OF EXPECTATION AND CONVERTING UNKNOWNS TO KNOWNS 

Welcome to this first edition of Orion Investment Managers Optimum for 2025 and what an interesting year lies ahead!

Overall, the consensus is that this year should see some improved economic growth globally and locally, albeit coming off a relatively weak base and emerging from a period of sustained and sticky inflation. The IMF sees global growth at 3,3 percent and while this is below the 2000-2019 average of 3,7 percent, some economies, particularly Asian, are set for healthy growth, notably India.  The Chinese economy has perplexed and worried investors for some time now, but the 2024 stimulus package could see a sustained recovery above 4,5 percent. The obvious conundrum is the impact of United States’ tariffs on China. This issue, more than any other variable, will determine global economic trajectories for the year ahead and beyond. 

This is not a case of former US Secretary Donald Rumsfeld’s unfathomable reflection that there are “unknown unknowns,”, but rather “known unknowns”. We know US tariffs are going to be imposed (likely from February), what we don’t yet know is their range, quantum, terms and conditions and of course their domestic impact on the US economy as well as those of counter tariffs or sanctions imposed by China, the European Union and possibly even Canada and Mexico. 

While asset managers dislike uncertainty, Orion Investment Managers is fully prepared and equipped to deal with these challenges. In fact, we have been preparing our portfolios for such eventualities for some time now. Our Investment Committee meets monthly to assess and adjust asset allocation and we consult with our local and global advisors every month to ensure optimal positioning. 

Locally, our team closely monitors and assesses political developments around the Government of National Unity, as well as contentious legislation relating to expropriation, NHI and the BELA Act. 2025 has to be a year of delivery for the GNU if it is to survive and thrive and despite positive sentiment from the market, investors and business, the GNU has yet to put many scores on the board. We would urge President Ramaphosa and his economic cluster Ministers to seize the moment and implement bold policies of economic reform to boost economic growth. We simply cannot continue with anemic economic growth, massive unemployment and the world’s highest inequality.

So, we look forward to hearing positive policy roll-out in the state of the nation next month and even more encouragement in the budget later in February. 

What we do have in Orion Investment Managers is world class asset management capabilities and whatever 2025 holds (and I think overall it’s going to be a good year), our entire team will be working night and day to deliver results for our investors.

I look forward to updating with you next quarter when some of the unknowns will certainly have become known.

Yours sincerely,

Ian Kilbride

Chairman and Chief Executive Officer