5 important things happening in South Africa today

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

Coronavirus: Global Covid-19 cases are around 20 million confirmed, with the death toll at over 731,000. In South Africa, there are now 563,598 confirmed cases, with 10,621 deaths. Recoveries are now at 417,200, leaving the country with a balance of 135,777 active cases.

  • Digging a hole: Government is spending R50 billion a month more than it is collecting in taxes, according to economist Mike Schussler, warning that the situation is worsening to the point it could reach a deficit of between R60 billion and R65 billion a month. The Covid-19 pandemic has pushed South Africa’s already bad tax deficit to as much as R700 billion in 2020, with the IMF loan only covering 10% of that. Schussler said government will be forced to borrow more money to cover the gap – and may have to go back to the IMF. [MyBroadband]

  • Municipal woes: Municipalities in all South African provinces, except the Western Cape, are in financial shambles, a new Ratings Afrika report shows, noting that a large portion of municipalities are financially unsustainable. The group says that despite municipalities raising enough revenue to deliver services to people, most fail to do so due to corruption in local government, with officials opting to rather run ‘dodgy side businesses’. [Moneyweb]

  • Covid aid: South African banks have collectively provided R45.5 billion in financial relief to individuals and businesses in response to the Covid-19 pandemic. R13.26 billion in loans have been extended. A high portion of those seeking assistance (84% of individuals and 95% of businesses) were granted it. This assistance is a payment break, not a debt write-off – giving recipients a longer window in which to pay their debts, not “free money” many have misconstrued the aid to be. Interest and fees will continue to accumulate. [TimesLive]

  • Census 2021: Stats SA is preparing to conduct the 2021 census electronically for the very first time – though not all of it will go digital. The spread of Covid-19 has forced the group to change tactics from door-to-door paper census, though this will still be done in hard-to-reach areas of the country, irrespective of the viral outbreak. Should the Covid-19 pandemic persist, however, the group will switch to a digital platform for taking count of the population. [702]

  • Markets: Markets were closed on Monday in South Africa for a public holiday. However, there has been a rebound in the dollar after the greenback faced seven weeks of losses, as investors bet on a fresh stimulus deal for the struggling US economy. Key engagements between the US and China are also in focus as the two nations are set to meet later this week. On Tuesday the rand is at R17.65 to the dollar, R20.73 to the eurp and R23.07 to the pound. Commentary by Peregrine Treasury Solutions. [XE]

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5 important things happening in South Africa today