Star 2022-09-21

Number of factors such as severe power cuts left economists speculating SOUTH Africa’s economic outlook deteriorated in the third quarter due to a number of factors such as severe power cuts, leaving economists speculating that the country’s economy will not grow by the expected 2% this year. The composite leading business cycle indicator in South Africa slipped by 1% month-over-month in July as load shedding intensified during the month, subduing employment creation as job advertisements fell. The South African Reserve Bank (SARB) said yesterday that this was the biggest decline in 10 months, which bodes poorly for the outlook as power outages reduced average hours worked per factory worker in manufacturing. It also affected other activities such as the number of building plans approved. The composite leading business cycle indicator…

PRESIDENT Cyril Ramaphosa has lamented the impact of intensified power cuts on business confidence in South Africa, saying that solving the electricity crisis was necessary to realise the potential of the economy. Eskom yesterday reduced the intensity of load shedding to Stage 5 as several units were returned to service even though a generating unit at Duvha was taken down due to a boiler tube leak. This followed a heightened level of loadshedding to Stage 6 on Sunday as Eskom had to shed 6 000MW from the grid following the collapse of a number of generation units. The situation was made worse by the depletion of emergency generation reserves such as pumped storage and diesel turbines and the need for these to be replenished. Ramaphosa yesterday said…

FITCH Ratings announced yesterday that it revised its metals and mining price assumptions lower, reflecting evolving economic growth expectations and demand and supply dynamics. Data from Statistics South Africa (StatsSA) yesterday showed that mining output plunged by 8.4% in July year-on-year following a downwardly revised 7.1% decline in June. This is bad news for South Africa’s domestic mining industry, with its hefty contribution to the country’s gross domestic product and which is now facing the added Eskom load shedding challenge. Data from StatsSA earlier this month showed that mining output plunged by 8.4% in July year-on-year following a downwardly revised 7.1% decline in June as analysts said at the time mining activity would probably be depressed for the remainder of the year, and drag economic growth even lower. Fitch said…

THUNGELA Resources yesterday signed a three-year wage agreement with the National Union of Mineworkers (NUM), a move that provides labour stability for the thermal coal exporter amid record high coal prices. NUM is the recognised labour union across Thungela’s operations, and which represents 86% of unionised employees. In a statement, Thungela said the agreement enabled the implementation of a new wage agreement across Thungela’s operations, other than Mafube, which runs an independent wage negotiation process. “The agreement is effective from June 1, 2022, and covers a period of three-years through to the end of May 2025. The wage agreement increases salaries and salary-related allowances and is expected to increase the total labour cost-to-company, on average by approximately 6% per annum over the three-year period," it said. The agreement entails that…

THE WORLD is heading for Net Zero Emission Day, which is becoming more evident as each day passes. Those arguing that it is a fallacy have lost the debate. Newton’s Third law states: “For every action, there is an equal and opposite reaction.” Newton published his laws of motion in 1687. Albert Einstein added more wisdom: “With every action, there is an equal opposite reaction. With every problem, there is a solution: just a matter of taking action.” The CO2 emission action is worldwide enormous and so is the reaction thereto. South Africa needs close to 60 000MW of electricity to function. Coal production is responsible for just more than 48 000MW. South Africa is the 12th largest greenhouse gas emitter in the world and the worst sulphur…

LOCAL is not lekker for businesses operating in some municipalities in terms of service delivery. North West’s Ditsobotla muni- cipality whose poor service delivery prompted the uprooting of Africa’s biggest cheese making factory by dairy group Clover last year, came up as a class act in the roll call of governance failures in the province yesterday. An update to Parliament’s portfolio committee on Co-operative Governance and Traditional Affairs was presented on an exercise started in 2019 to clean-up rampant corruption, poor governance, unqualified personnel, cronyism, violence, poor service delivery and political instability. The provincial Treasury Department and the South African Local Government Association (Salga) briefed an incredulous committee about the interventions which seemed to have borne minimal fruit. The parliamentary committee heard that of the 43 municipalities dissolved and…