News in South Africa 11th March:
1. Third wave a certainty:
As health officials warn that South Africa is likely to miss its vaccination targets, it is almost a certainty that the country is going to face a third wave of Covid-19.
Medical experts have warned that the slow rollout of Covid vaccines in the country means that infections are likely to pick up again in April and May, and said that authorities need to prepare for that now, to avoid more deaths and overloaded hospitals.
They said that there is ample data from the first and second waves to help government prepare.
2. Load shedding on the rise:
Eskom started stage 2 load shedding yesterday, which will continue until Friday. It warned that there was a high probability that load shedding may run into the weekend.
Power utility Eskom will implement stage 2 load shedding from 17:00 on Wednesday, until 23:00 on Friday, with a high chance of continuing throughout the weekend.
Eskom said this was due to poor performance at the Kusile, Duvha and Tutuka power stations, along with delays in returning other units to service, and breakdowns over the last week.
“Eskom has had to extensively utilise the emergency generation reserves, which are being rapidly depleted. This period of load shedding will be used to replenish the emergency generation preserves,” the power utility said in a statement.
3. Zweli Mkhize won’t step down:
Health Minister Zweli Mkhize has made it clear that he will not step aside while an R82 million contract issued to two close associates of his is investigated.
Mkhize was asked whether he did not see it fit to step down while the Special Investigating Unit (SIU) investigates the allegations involving the company, Digital Vibes.
Mkhize faced questions from the Democratic Alliance’s Siviwe Gwarube about the R82 million contract.
The minister said he and the health department were fully cooperating with the investigation, and that no further action was needed.
4. Business leaders unhappy with business conditions:
The RMB/BER Business Confidence Index (BCI) faltered again this quarter, highlighting the perilous state of South Africa’s economy. But the February reading of the BankservAfrica Economic Transaction Index (BETI) suggests some green shoots.
Seven out of 10 senior South African business executives are dissatisfied with prevailing business conditions. This is according to the latest RMB BCI, which is based on a survey of around 1,300 executives. The BCI declined to 35 from 40 in the previous quarter, when six out of 10 executives were bearish about the local business environment.
RMB said the survey “was conducted mainly during the second half of February when the peak of the second wave of COVID-19 infections had passed, and certain restrictions (such as the complete ban on alcohol sales and access to beaches) were already lifted. Load-shedding was also less pronounced during the survey period. That confidence failed to improve further is therefore telling.”
“Confidence fell across all the five sectors making up the RMB/BER BCI. Retail saw the biggest decline, followed by manufacturing and new vehicle dealers. Sentiment among building contractors and wholesale traders deteriorated slightly. Except for the wholesale trade, confidence in every other sector remained well below the 50-point neutral level i.e. in net negative terrain,” RMB said.
5. Sanlam and Famous Brands report losses:
Sanlam reported a 13% fall in operating profit (“net result from financial services”) this morning, due in part to higher death claims. New business volumes increased by 25% to R311 billion – thanks to strong growth in its investment business (+37%).
Famous Brands this morning reported a sharp slump in sales over the past year. Sales at its leading brands (Steers and Debonairs) in SA fell almost 30%, while at Vovo Telo, Europa and others, sales declined by two-thirds. The company said it was not yet in a position to predict how its profit will be affected for the year to end-February.
Brait this morning announced a restructuring plan for its Virgin Active UK unit. Lockdowns have hit its gyms hard, with revenue down almost 50% at Virgin Active Europe. The plan, which has the support of some of its creditors, involves writing off some arrears, and new funding from shareholders. The restructuring plan won’t have an impact on Virgin Active in SA, the company said.