Business

5 important things happening in South Africa today

Staff Writer

 ·24 Apr 2023

Here’s what is happening in and affecting South Africa today:

• Eskom wage negotiations: Eskom unions – who demand a 15% wage increase and other things – have rejected the utility’s offer of a 3.75% wage hike and accused Eskom of approaching the talks in a ‘shambolic and unprofessional’ manner. The first round of wage talks took place from 19 to 21 April. They will recommence on 8 May, and already things seem to be going pear-shaped, as concerns of protests will worsen load shedding remain. [Daily Maverick]

• South Africa is poorer: Energy expert Clyde Mallinson said load-shedding crushed South Africa’s economic growth and has made the country much poorer. World Bank data shows South Africa’s GDP declined from $458 billion to $419 billion over the last decade, showing the country’s economy shrunk by 9%. South Africa’s population increased from 52 million to 59 million over this period, which means citizens are now significantly poorer than ten years ago. [Daily Investor]

• Water prices may rise: According to some studies, South Africa’s demand for water could outstrip supply by 17% by 2030, thanks to corruption, mismanagement, population growth, load shedding, and the deepening impacts of climate change. To avoid a catastrophe, South Africa will need to ramp up investments in water infrastructure – in long-overdue maintenance and in greenfield projects – while simultaneously taking measures to keep demand in check, which includes hiking prices by a notable margin. [BusinessDay]

• Motor industry troubles: Motor industry leaders collectively complained that the government was threatening the future of the SA motor industry by dragging its feet on policy for electric vehicles (EVs). The industry contributes a considerable amount of revenue to South Africa’s GDP, and future investments are already being put at risk from EV indecision. Despite this, Trade, Industry and Competition minister Ebrahim Patel told parliament on Friday (21 April) that they may have to wait another year for a decision. [BusinessLive]

• Markets: The South African rand was weaker in early trade on Friday (21 April), as rising expectations that the US Federal Reserve will raise interest rates by 25 basis points (bps) in May lent support to the dollar. The risk-sensitive rand often takes its cue from global factors like the outlook for US monetary policy in the absence of major local drivers. On Monday (24 April), the rand was trading at R18.11/$, R19.88/€, and R22.51/£. Brent crude is trading at $80.62 a barrel. [Nasdaq]