Here’s what is happening in and affecting South Africa today:
Coronavirus: Total global infections since the start of the year have hit 9.4 million, with the death toll now over 482,000. In South Africa, cases continue to climb, with the country registering 6,579 new cases taking the total to 118,375. Deaths are also increasing, with the toll now at 2,292. Recoveries are at 59,974, leaving a balance of 56,109 active cases.
- Unrealistic: The South African government target to stabilise its ballooning debt by 2023 will be very difficult to achieve and unlikely, ratings agency Moody’s says. Given South Africa’s weak track record of fiscal consolidation in recent years and the weak medium-term economic outlook, debt stabilisation by 2023 will be very difficult to achieve. The economy was in recession before the Covid-19 outbreak ravaged it, and the lockdown that followed late in March has put further strain on businesses and consumers, it said. [Reuters]
- No coup: Deputy president David Mabuza has made a rare appearance to answer questions in parliament – and has assured MPs that the National Coronavirus Command Council has not take over or usurped powers from the three arms of government, including parliament. Mabuza said that the council is a sub-structure of cabinet, and is chaired by the president. The legality of the council’s formation is in question, with a court process in the works to test this. Critics claim the council is operating without oversight from parliament. [TimesLive]
- Insurance claims: As restaurants and hotels wait on government to publish the rules and regulations that will allow them to start earning a living once again, they have run into further problems – this time around business interruption insurance claims. One insurer, Santam, has clarified a particular point of contention: their insurance only covers business lost as a result of Covid-19 (ie, a staff member got infected and the business was shut down), and not the nationwide lockdown (businesses closing down due to government regulations). [Moneyweb]
- Delayed: After getting court approval to move forward with the vote on SAA’s future as a new, restructured airline, the group’s creditors and unions decided to take some time to review the proposed business rescue plan, thus delaying the process. The meeting and vote has been delayed to July. The groups want the plan to be redone in some places, and for negotiations with workers to continue. The current plan would require R10 billion from government to execute – and for thousands of workers to be retrenched. [EWN]
- Markets: The rand clawed back additional ground towards the end of the week, as investors found comfort in the fact that economies remain on the path of reopening, even as numbers of Covid-19 infections continue to rise. With minimal data releases today, we are expecting to see the rand test its continued move stronger, as markets search for a new catalyst. On Friday the rand is at R17.15 to the dollar, R19.23 to the euro and R21.29 to the pound. Commentary by Peregrine Treasury Solutions. [XE]