5 important things happening in South Africa today

 ·4 Jul 2022

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

  • Grey list: South Africa is set to be placed on a ‘grey list’  by the Financial Action Task Force (FATF) after failing to take sufficient regulatory action against terrorism funding and money laundering activities. Greylisting by the FATF would raise South Africa’s risk profile, place a question mark over its financial regulatory bodies and attach a higher risk premium to corresponding relationships between South African banks and international financial institutions. [Fin24]

  • Increased data costs: Mobile network operators are spending billions of rands to keep their towers online and customers connected during stage load shedding. South Africa’s mobile networks say stage 4 and stage 6 has meant backup power sources are less reliable in keeping voice and data services going. Eventually, the operators will have to start passing these extra — and still rising — costs on, a move that will heap even more pressure on struggling consumers. [BusinessDay]

  • Eskom debt: The National Treasury is working on a solution to restructure Eskom’s R400 billion debt burden, which it hopes to put to the Cabinet ministers’ committee on the budget by October. Eskom’s debt has been a significant issue for South Africa’s risk profile and the budget since 2018, but due to uncertainty in government over what route to take, no progress has been made. [News24]

  • Petrol price hike: South Africa faces another steep petrol price increased on Wednesday as global oil prices remain high and the rand continues to see weakness on the back of load shedding. The Western Cape government has warned of an uptick in ‘fuel saving’ devices being used by motorists to mitigate these increases but noted that these devices are unlikely to save people money but could damage their car. [eNCA]

  • Markets: The rand hit a one-year low against the dollar last week as the greenback rose, boosted by pessimism about the outlook for the global economy. This was compounded by prolonged power cuts at state power utility Eskom, with stage 6 load shedding set to resume on Monday. The rand is currently trading at R16.36/$, R17.06/€ and R19.79/£. [Reuters]
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