Star 2023-04-06

Plug pulled on Eskom’s exemption from reporting on irregular expenditure IN A SURPRISING U-turn, South Africa’s Finance Minister Enoch Godongwana announced the withdrawal of the gazette on the Eskom exemption from reporting on irregular and wasteful expenditure for three years. This came after a massive outcry in the country and the finance boss’s meeting with Auditor-General Tsakani Maluleke. Godongwana told Parliament yesterday, after meeting Maluleke, pending further consultations on the matter, that the National Treasury would be pulling the plug on the gazette. Godongwana was appearing before the joint committees on the auditor-general, finance, appropriations and public enterprises. He said that granting the exemption to Eskom was informed by its financial situation. Godongwana said that when viewing the situation at the ailing power utility, the Treasury realised it would not…

IT WAS ANOTHER day of gloomy news for the South African economy as the S&P Global South Africa Purchasing Managers’ Index (PMI) data revealed that business activity in March declined to 49.7 points from 50.5 points in February. The 50-point mark divides growth from contraction. Once again, rolling power cuts were the dark cloud haunting businesses, as well as inflationary pressures. South Africa has been experiencing load shedding on a daily basis since the onset of this year by ailing State power utility, Eskom, placing strain on many aspects of the economy. David Owen, senior economist at S&P Global Market Intelligence, said: ‘’Output returned to contraction after stabilising in the previous month, as firms highlighted that ongoing load shedding (power cuts) had curtailed activity.’’ Owen said recent price…

GOLD FIELDS said its 50:50 joint venture with Gold Road Resources, the Gruyere joint venture (JV), this week achieved its first one million ounces of gold production. The long-life, low-cost, Tier 1 gold mine is located 1 200km north-east of Perth in Western Australia’s north-east Goldfields region. Gold Road Resources CEO Duncan Gibbs said: “The Gruyere team has performed safely and sustainably at an impressive rate that has seen this milestone achieved in line with annual guidance.” Gold Fields Australia vice-president Stuart Mathews said: “We are proud of the team on reaching this milestone and on the delivery of projects like the Gruyere solar farm that was launched in 2022 and supports our global decarbonisation objectives. “The solar component of Gruyere’s hybrid microgrid accounts for about 10% of the…

EOH, AN IT group that has required a turnaround plan, has flagged a small increase in revenue and a sharp decrease in net profit for the six months to January 31, 2023. EOH CEO Stephen van Coller said: “For the first time since 2019, I am able to address our stakeholders in the context of EOH being a normal business. “For many years, we have been battling corruption scandals, unprofitable legacy contracts, inefficient corporate structures, huge debt burdens, and a highly inefficient capital structure.” Its results released yesterday showed that operating profit from continuing operations decreased to R110 million in the six months to end-January, from R162m in the prior comparative period, but comparing favourably to the R100m operating profit for its full 2022 year. Revenue rose 8% to…

THE WELL-PUBLICISED collapse of Silicon Valley Bank (SVB) in the US, followed in short order by New York’s Signature Bank, highlighted the important role deposit insurance plays. It successfully prevented widespread panic over the solvency of the many regional banks operating in the US, some of which, like SVB and Signature, are surprisingly large. The South African Reserve Bank introduced a new deposit insurance scheme, which came into effect on 24 March 24, 2023. This means South Africa is also one of the G20 nations to adopt statutory insurance to protect depositors in the event of a bank failure. The Reserve Bank has established a subsidiary, the Corporation for Deposit Insurance (CoDI), to levy premiums on banks and manage a fund to be used to repay the depositors of failed…

LACTALIS South Africa (LSA) has invested R140 million in a new evapo- rator dryer powder plant facility at its cheese-manufacturing plant in Bonnie- vale in the Western Cape. LSA general manager Alban Damour said in a state- ment yesterday that the new plant would significantly boost skimmed milk production capacity. The plant was officially opened on Tuesday. The group’s Bonnievale factory is one of the biggest cheese factories on the African continent and currently provides employment to 800 employees. “This investment demonstrates the commitment by Group Lactalis to strengthen its business in South Africa. We remain focused on finding innovative business solutions that enable the production of high-quality food pro- ducts while creating employment and making a difference in the communi- ties in which we operate,” said Damour. The…