Stronger rand means better smartphone deals in South Africa

With Jacob Zuma resigning and Cyril Ramaphosa succeeding him as President of South Africa, the rand has strengthened significantly against the US dollar.

This bodes well for smartphone lovers in South Africa looking to buy a new device this year, as they can expect to receive additional value.

All smartphone distributors buy stock in foreign currency, usually the US dollar, to resell in South Africa. An improvement in the exchange rate therefore has the potential to reduce the cost of importing devices.

“We’re all in the same position,” Shaun Durandt – general manager for HMD Global in Southern Africa – told MyBroadband.

HMD Global has the licence to manufacture devices under the Nokia brand.

Durandt explained that operators and retailers might have different strategies for dealing with the risks of a volatile exchange rate, however.

While some might buy at the spot price, others could decide to take forward cover – which fixes their rate of exchange for a particular shipment.

That said, all manufacturers are looking for ways to create additional value for users.

“South Africa is still in a very sensitive place at the moment in terms of disposable income,” said Durandt.

A reduction in the exchange rate provides an opportunity to create additional value for consumers, whether it is by reducing the price or bundling additional data with smartphone packages.

Networks and manufacturers are battling it out to differentiate their products and services, said Durandt, and it is logical to conclude that the industry will try to cut their prices or add value in multiple ways.

Now read: Nokia will give pure and always up-to-date Android in South Africa

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Stronger rand means better smartphone deals in South Africa