Here’s what is happening in and affecting South Africa today:
- Load shedding: Eskom says that its grid is slowly stabilising, with no expected load shedding today. The group has noted that trips are becoming far less frequent, and that its reserves are piling up, allowing it to take necessary measures to ensure load shedding doesn’t have to be implemented. Despite this, total unplanned outages are still above the 9,500MW level to guarantee that load shedding isn’t needed. Outages were just over 11,500MW. [Eskom]
- Despite a financial crisis and a daily fight to keep the lights on, Eskom cannot shake questionable contracts and the air of corruption. The latest news to raise eyebrows at the power utility are how former chairman Jabu Mabuza’s name is tied up in an R11 billion boiler maintenance contract, which has reportedly benefited ‘a distant relative’ of his. The possible conflict of interest was highlighted just weeks before Mabuza resigned. [Mail & Guardian]
- Finance minister Tito Mboweni says the pace of structural reforms to turn South Africa’s economy around is not where it should be, and is moving far slower than he had anticipated. However, despite the slow pace, positive changes are happening, he says. Mboweni will be leading the South African delegation to the World Economic Forum in Davos next week, where he said he will give a realistic overview of what’s happening in South Africa, without lying or trying to spin a story. [Moneyweb]
- While the Reserve Bank’s ‘surprise’ rate cut this week has been welcomed, analysts and economists are not that moved by it, saying that it will do little to change the economic reality in South Africa. Some analysts have said that cut, which was not expected by most, stands in contrast to the message out of the central bank in November 2019, sending mixed signals to the market, who now don’t know what to expect at the next review. [Reuters, Intellidex]
- South Africa’s rand inched up on Thursday after the central bank unexpectedly cut its main lending rate by 25 basis points to 6.25%, providing a stimulus to the flagging economy. The majority of analysts polled by Reuters had expected no change in rates because of risks associated with a February budget speech and a scheduled rating review by Moody’s in March. On Friday the rand was at R14.41 to the dollar, R18.84 to the pound and R16.05 to the euro.