South Africa bans cannabis and hemp products, and Eskom maintenance lie

The South African rand weakened on Thursday (13 March) as the dollar regained some strength after recent losses. This decline came a day after the national budget was presented, where it faced resistance.

The rand was trading at 18.33 against the U.S. dollar, approximately 0.1% lower than its previous close. At one point on Wednesday, it had fallen by more than 1%.

Domestic investors will be closely monitoring the discussions following the budget on Friday (14 March), particularly after the hike in value-added tax (VAT).

This is because Finance Minister Enoch Godongwana’s proposal to raise VAT by 0.5 percentage points this year and an additional 0.5 percentage points next year faced pushback.

On Friday (14 March), the rand was trading at R18.31 to the dollar, R23.69 to the pound and R19.85 to the euro. Oil is trading lower at $70.34 a barrel.

Here are five other news stories making waves in South Africa today:

Cannabis & hemp products ban: Health Minister Aaron Motsoaledi has gazetted regulations banning the manufacture, sale, and import of food products derived from cannabis and hemp, which also affects legal items like hemp seed oil and flour. Myron Krost, CEO of Canna Trade Africa, believes these new regulations are confusing and nonsensical for the industry. [BusinessTech]

Eskom maintenance lie: Energy expert Chris Yelland has accused Eskom and Electricity Minister Kgosientsho Ramokgopa of misleading the public about their maintenance program. He noted that, despite claims of aggressive maintenance this year, the planned outages in the first 10 weeks of 2025 are consistently lower than in the same period last year. [MyBroadband]

Pilot exodus: Trade union Solidarity is preparing to enter into salary negotiations with FlySafair to improve the employment conditions of pilots, which it believes threatens an exodus of skilled personnel. [BusinessTech]

One man behind VAT hike: Finance Minister Enoch Godongwana stated that he was solely responsible for the controversial decision to increase VAT by two percentage points, which resulted in a delay of last month’s budget. he said one day he woke up and thought, ‘Everyone has been criticising me for austerity. I’m tired of it. This time, I am going to raise taxes. [News24]

South Africa turns to China: South Africa has turned to China to fill the climate funding gap after the US withdrawal from the Just Energy Transition Partnership (JETP) last week, which removed about $1 billion from the country’s climate financing. [Business Day]