News in South Africa 14th June:
1. New workplace Covid-19 regulations:
Labour minister Thulas Nxesi has published a new directive focusing on Covid-19 and the workplace, outlining the health and safety protocols that businesses and employees are required to follow during the lockdown.
While a number of the regulations have been gazetted before, this directive serves to consolidate and update the existing regulations as it deals with new issues. For the first time, the regulations also deal with the issue of vaccinations and whether an employer can make them mandatory.
It gives an employer 21 days to make a decision on whether it intends to make vaccination mandatory, taking into account the operational requirements of the workplace.
Employers will also be required to develop a plan outlining the protective measures in place for the phased return of workers, and the measures it plans to implement to ensure that workers are vaccinated.
Other issues which should be included in the plan are:
- The date the workplace will open and the hours it will be opening;
- A list of employees permitted to work and those who are required to work from home;
- The plan and timetable for the phased return of employees;
- The employees who have been identified as vulnerable;
- Ways of minimising workers in the workplace;
- The measures for the daily screening of employees, clients, contractors and visitors;
- Procedures for employees who refuse to work due to fear of exposure to Covid-19.
Should an employee refuse to be vaccinated on constitutional or medical grounds, the employer should:
- Counsel the employee, and if requested, allow the employee to seek guidance from a health, worker or trade representative;
- Refer for medical evaluation should there be a be medical contraindication for vaccination;
- If necessary, takes steps to reasonably accommodate an employee in a position that does not require them to be vaccinated.
The National Coronavirus Command Council is reportedly to meet ‘soon’, with further lockdown restrictions said to be on the agenda, given the recent rise in Covid-19 cases in South Africa, putting the country into a third wave of infection. While medical and health experts are on board for tighter lockdown – asking for smaller gatherings and a longer curfew – not everyone is on board with it.
2. Positive economic outlook:
South Africa has extremely bright economic prospects, according to two prominent economists.
Roelof Botha, an economic advisor of Optimum Investment Group, said the economy is recovering off a low base but the super cycle started in 2019 and was interrupted by Covid-19, which will probably continue for quite some time.
“But India is expected to grow by 12% this year, China by above 8% and the US by close to 6%,” he said. “There is absolutely no way that the South African economy is going to grow less than 5% this year and it should be able to maintain that momentum.
“So the jobs will be coming, especially if the government is true to its word and it creates a more enabling environment for the private sector by removing the obstacles to growth – and they can start with labour legislation.”
Azar Jammine, the chief economist of Econometrix, said the economic recovery off an extremely low and depressed base has been a little stronger than anticipated as seen by the latest GDP figures.
Jammine said South Africa has also learnt that the strength of the economy is derived from the fact that the middle and higher income groups were not nearly as severely affected by Covid-19 as the lower income groups and informal economy.
He said the middle and upper income groups account for between 80% and 85% of the spending power in the country, which has meant the country’s tax revenues have not declined to the extent anticipated and the budget deficit and government’s borrowing requirements are not as large as anticipated.
Jammine said this recovery is being assisted by the global environment, which is looking more positive than it has for a decade because of the development of Covid-19 vaccines, a return to normal economic conditions far sooner than anticipated, and the world’s leading governments and central banks having embarked upon the biggest stimulus the world has ever seen.
3. Road demerit system:
South African motorists who commit traffic offences will soon receive demerit points which can lead to their licenses being suspended and, ultimately, cancelled.
The Administrative Adjudication of Road Traffic Offences (Aarto) Act, which has proposed a demerit system for road infringements since 2008, will come into effect on 1 July. The Act has faced multiple challenges in recent years, with the latest legal fight from the Organisation Undoing Tax Abuse (Outa) aimed at declaring the legislation unconstitutional.
The Act’s opponents argue that the new regulations will do little to curb the carnage on South Africa’s roads and, instead, infringe the rights of motorists and existing municipal bylaws.
Under the new AARTO system, all motorists will start 1 July with zero demerit points on their licenses. Demerit points will be added to the motorist’s license when a fine is paid, the offender is found guilty in court, or when an enforcement order is issued.
A motorist’s drivers license will be suspended for three months once more than 15 demerit points have been accumulated. An additional three-month suspension will be added for every demerit accumulated beyond the 15-point threshold. Motorists who operate a vehicle with a suspended license will receive a further six demerit points, and could even face jail time when convicted.
Two suspensions will result in the license being cancelled. One point will be reduced for every three months that a motorist does not record any infringements.
There are 100 serious offences listed within Schedule 3 of the AARTO Regulations which carry six demerit points and mandatory court appearances. Some examples of the most serious six-point offences, which do not come with the option to pay an admission of guilt fine but, instead, require the motorist to appear in court, include:
- Failure to stop a vehicle on command of a traffic officer.
- Operating a vehicle contrary to the class of vehicle to which such driving licence relates.
- Driving 91-92 km/h in a 60 km/h zone, 161+ km/h in a 120km/h zone, 110+ km/h in an 80 km/h zone, and 70+ km/h in a 40 km/h zone.
- Operating a vehicle while under the influence of intoxicating liquor or a drug with a narcotic effect.
- Failure to ascertain if someone was killed or injured or the extent of injuries at the scene of an accident in which he or she was involved.
- Riding in or driving a vehicle without the consent of the owner, operator, or person in lawful charge thereof.
- Using or making a number plate which did not comply with the prescribed specifications.
- Falsifying or counterfeiting a certificate, licence or other document issued or recognised in terms the Act.
All six-point offences carry a No Admission of guilt Penalty (NAP). Offences which carry five demerit points also come with fines ranging from R1,500 to R3,500.
4. Vaccine production uptick:
President Cyril Ramaphosa said that he had been assured by Aspen Pharmaceuticals that it would beef up its capacity to start working on a new batch of Johnson & Johnson vaccines this week.
On Sunday, Ramaphosa announced that South Africa would pull two million doses of the Johnson & Johnson vaccine following contamination concerns at one of the company’s sites in the United States. Ramaphosa was speaking during the closing of the G7 meeting in the United Kingdom.
South Africa is struggling to roll out its inoculation programme and is in the grips of a third wave of the coronavirus pandemic with increased infections and fatalities.
Ramaphosa said that he had discussions with US President Joe Biden about donating vaccines to the continent.
“And in my discussions with President Biden, we did say to him that we would like doses that he’s going to donate also to be channeled to Africa, also to be channeled to South Africa,” he said.
With some parts of the world grappling with a third wave of COVID-19 infections, Ramaphosa said that poorer countries should also get all their citizens vaccinated, with the help of rich nations.
“All of us around the world need to be vaccinated and when we are vaccinated, we will have a better defence.”
5. Trends for markets:
The effects of the Covid-19 pandemic have left many markets reeling, yet in Africa, there are some bright spots, says CM Trading. Lockdowns and remote working have changed the economic landscape and challenged businesses and their clients to adapt. A big area of change is the money market as countries throughout Africa push ahead towards a cashless continent.
As mobile penetration increases and digital payment methods become more accessible, this has triggered a scramble for control of the mobile money market and the industry that supports it.
Below are some of the trends investors should be watching in 2021:
- Billions pour into fintech
In Africa, fintech funding and mergers & acquistions grew to $1.35bn in 2020, according to a report by BFA Global’s Catalyst Fund and Briter Bridges, published in May 2021.
The report, which surveyed 177 start-ups and 33 investors on the continent, found that most of the investment flowed into Nigeria, Kenya and SA. This has resulted in the rise of companies hoping to take advantage of the growing trend towards digital payments and e-commerce.
- Cryptocurrency
Though the crypto king, bitcoin, has dropped in price in the past month, it should be noted that the cryptocurrency rose from a low of $9,400 in May 2020 to a record high of $64,000 in April.
- Mobile money revolution
The Africa CEO Forum reported that 70% of Africa’s financial institutions reported shifting towards the digitisation of their businesses due to the pandemic. Nigeria has seen a 500% increase in online payments in 2019, reports the Nigeria Inter-bank Settlement Scheme.
Why are mobile money accounts important? According to a McKinsey study, about two-billion people and 200-million businesses lack access to formal savings and credit. For investors, this is an area to watch, especially as bitcoin becomes normalised for payments in African countries such as Nigeria.
All information sourced from articles posted by: BusinessTech, ENCA, Moneyweb, Business Insider, EWN, and TimesLive.
