Here’s what is happening in and affecting South Africa today:
Coronavirus: Global Covid-19 infections have hit a total of 11.2 million cases confirmed since the start of the year, with the death toll up to 530,000. In South Africa, infections continue to increase rapidly, with total infections now at 196,750. Deaths have also increased to 3,199, while recoveries are at 93,315. This leaves a balance of 100,236 active cases in the country.
- School return: The return to school for kids South Africa has become a confusing mess, with grades 6 and 11 to return today, and grade R learners only if schools are prepared. Other grades are expected to return at unspecified times later in the month. KwaZulu-Natal, North West and Limpopo have announced that grade R pupils will not return – while parents who are afraid of having their children go back amid rising Covid-19 infections, are opting for home schooling. [TimesLive, ENCA]
- Tax cuts: Many employees in the private sector have suffered pay cuts due to the Covid-19 lockdown – this means that many will be paying less income tax as a result. Calculations show that someone who earns R300,000 a year who took a 30% pay cut, will end up paying 50% less tax. While this may seem like a silver lining to the overall coronavirus crisis, this has the effect of messing with National Treasury’s budgeting – with experts saying current figures for tax collection look overly optimistic. [Moneyweb]
- SAA fury: A presentation from National Treasury has riled up unions at SAA, who are threatening action against any attempt to liquidate the airline. The presentation said that no more bailouts were heading the airline’s way, as it is insolvent, with a slide saying that the airline should be closed. This was interpreted by opposition parties as government taking the decision to liquidate the airline. The unions said they would not accept the liquidation of SAA or any other state owned company. [News24]
- Doubts: All major ratings firms have expressed doubt over South Africa’s capacity to fulfil the requirements of the supplementary budget tabled by finance minister Tito Mboweni last month. S&P Global was the latest to comment, saying that the budget lacked any detail on where proposed budget cuts were supposed to come from, taking away a lot of credibility from what was said and promised. Moody’s and Fitch have also cast doubt over government’s capacity to follow through. [BusinessLive – paywall]
- Markets: South Africa’s rand weakened on Friday after two days of gains, weighed down by fears of a rebound in global Covid-19 infections and concerns about the local economy. The JSE also slipped on Friday but ended the week 1.6% higher. Losses in the day were also spurred by low liquidity as the US market was closed for a bank holiday. On Monday the rand was at R16.95 to the dollar, R21.18 to the pound and R19.13 to the euro. Commentary by Reuters. [XE]