Eskom turning a corner, and VAT hike cancelled for South Africa

The South African rand weakened on Wednesday, 23 April, after data revealed that local inflation dropped to its lowest level in five years as of March.

The rand was trading at 18.64 against the dollar, which is approximately 0.2% lower than Tuesday’s closing value.

Trading in the rand has been highly volatile for weeks, with financial markets dealing with divisions within the ruling coalition concerning the national budget and uncertainty regarding U.S. President Donald Trump’s tariff plans.

On Thursday, 24 April, the rand was trading at R18.67 to the dollar, R24.78 to the pound and R21.17 to the euro. Oil was trading slightly lower at $66.19 a barrel.

Here are five other important things happening in and affecting South Africa today:

Eskom turning a corner: The National Treasury is confident that Eskom has improved its financial situation after receiving a three-year bailout of R254 billion in 2023. During a meeting with the standing committee on appropriations, they noted that Eskom has effectively used the funds, alleviating concerns about its financial stability. Director Jeffrey Quvane stated that Eskom is expected to turn a profit once its 2024 financial records are audited. [EWN]

No VAT hike: The Minister of Finance, Enoch Godongwana, will soon implement measures to reverse the highly contested and reviled VAT hike in South Africa, which will see the VAT rate remain at 15%. “The decision to forgo the increase follows extensive consultations with political parties, and careful consideration of the recommendations of the parliamentary committees,” the Treasury said. [BusinessTech]

Debt trouble for South Africa: The IMF has warned that South Africa’s public debt will rise to 88% of GDP by 2030, contrary to the National Treasury’s projections, unless the government enforces stricter fiscal policies. This forecast is more pessimistic than the IMF’s earlier projections from January and those of the Treasury. [Business Day]

South Africa to sit down with the USA: Minister of Trade, Industry, and Competition, Ebrahim Patel, will hold his first informal meeting with a US trade representative on Friday. This meeting comes in the wake of US President Donald Trump’s announcement that he would impose 30% tariffs on South African imports as part of a global trade war that has unsettled world markets. [News24]

Electronic voting: The electoral commission (IEC) is rolling out a six-month engagement period to receive views from stakeholders, voters and interest groups on plans to introduce electronic voting in South Africa. Electoral commission CEO Sy Mamabolo emphasised that e-voting should improve election efficiency, transparency, trust in outcomes, and voter convenience, potentially boosting participation from specific demographics, such as the youth. [Times Live]