News in South Africa 16th August:

1. Third wave hits Cape and Natal:

The Western Cape and KwaZulu-Natal are now driving the third wave of Covid-19 in South Africa, with a spike in cases in the latter province as a result of riots and looting in huge crowds in mid-July.

Third wave hits Cape and Natal
Image taken by: Sora Shimazaki

KwaZulu-Natal is in its third wave of Covid-19 infections, premier Sihle Zikalala confirmed on Sunday.

The province has recorded 3,000 cases daily and has more than 40,000 active Covid-19 cases, he said, adding that transmission rates were very high.

Zikalala said the increase in infections was partly because of large gatherings by people engaging in looting and the destruction of property, it was reported.

“The province has for the past three consecutive days recorded more than 3,000 new cases and is reporting the second-highest number of daily confirmed cases. Our third wave appears to be due to the sustained increase in the rate of new infections. The surge in cases appears to be have been driven in the main by the recent large gathering by people engaging in looting and destruction of property,” Zikalala was quoted as saying.

He urged people to get vaccinated and adhere to the adjusted level 3 lockdown regulations.

He expressed concern about a number of pubs and restaurants flouting regulations, warning: “We are going to take a hard, hard line against [the culprits].”

The Western Cape warned that hospitals are coming under severe strain and filling up quickly.

Covid Numbers: 

In South Africa, there have been 10,139 new cases of Covid-19, taking the total reported to 2,605,586. Deaths have reached 77,141 (+272), while recoveries have climbed to 2,375,633, leaving the country with a balance of 152,812 active cases. The total number of vaccines administered is 9,387,129 (+13,786).

2. Restaurants want lockdown relaxed:

The Restaurant Association of South Africa (Rasa) has called for the further relaxation of the country’s lockdown laws, as thousands of businesses continue to trade in a restricted environment, including reduced hours.

The association’s chief executive Wendy Alberts told BusinessDay that an estimated 1,100 restaurants shut down during the third wave of the Covid-19 pandemic.

While the association once had a database of more than 23,400 restaurants, she said that this has since dropped to 9,000 since the pandemic started, leaving thousands of workers jobless.

Alberts added that calls for financial assistance from the government have fallen on deaf ears.

South Africa moved to an adjusted level 3 lockdown on 25 July, with a number of restrictions still in place on eateries and other businesses.

This includes:

  • An evening curfew from 22h00 – 04h00
  • Non-essential establishments, such as restaurants, gyms and fitness centres, can operate but must close by 21h00;
  • The sale of alcohol from retail outlets for off-site consumption will be permitted between 10h00 and 18h00 from Monday to Thursday. Alcohol sales for on-site consumption will be permitted as per licence conditions up to 20h00;
  • Gatherings are allowed but are limited to 50 people indoors and 100 outdoors. Only 50 people are allowed to attend funerals.

Data from Statistics South Africa showed that close to 1,000 businesses have been liquidated in the first half of 2021.

Liquidation refers to the winding-up of the affairs of a company or close corporation when liabilities exceed assets and it can be resolved by voluntary action or by an order of the court.

The group recorded 997 liquidations of companies and close corporations between January and June 2021, up from 763 businesses over the same period last year. Over 2,000 liquidations were recorded by the end of 2020.

3. Public hearings regarding powerships:

The National Electricity Energy Regulator of South Africa (Nersa) commences public hearings on Thursday (August 19) for generation licence applications under the so-called emergency Risk Mitigation Independent Power Producer Procurement (RMIPPP) programme conducted by the IPP Office of the Department of Mineral Resources and Energy (DMRE).

The programme comprises 11 projects totalling 1 996 megawatts (MW). Of this, some 1 220MW, or 60%, is made up of three floating power plants (‘powerships’) and associated floating storage and regasification units (FSRUs) from Turkish company Karpowership.

The balance comprises eight projects, ranging from 75MW to 200MW, incorporating various combinations of wind, solar photo-voltaic (PV), battery energy storage and diesel/gas engines.

The public hearings commence amid growing opposition to the three Karpowership projects, including a substantial submission last Friday (August 13) by the Organisation Undoing Tax Abuse (Outa), in terms of the regulator’s call for comment and response to the licence applications by the public and other affected stakeholders.

The public hearings come about three weeks after the IPP Office extended the ‘non-negotiable’ deadline of July 31 for financial closure of these projects stated by DMRE Minister Gwede Mantashe on March 21 when announcing the first tranche of preferred bidders for the RMIPPP programme.

The department says it extended the REIPPP programme’s commercial closing date to September 30 to allow for finalisation of regulatory processes, including Eskom board approval to conclude power purchase agreements (PPAs) with the successful bidders, and related approvals in terms of the Public Finance Management Act (PFMA).

However, it has become increasingly clear from Outa’s submission to Nersa that the three Karpowership projects, which would see the powerships and their associated FSRUs anchored in sensitive ecological areas of Richards Bay, Coega and Saldanha Bay for 20 years, are themselves far from ready to achieve financial closure.

4. Limpopo frost causes food price hikes:

Prices for tomatoes, spinach, and peppers, have surged at least 20% in just one week due to frost in the Limpopo region that has caused severe damage to crops.

Last week, volumes of spinach and peppers delivered to fresh produce markets declined. This resulted in prices shooting up for, Johnny van der Merwe, managing director of agricultural information group Agrimark Trends (AMT), said in his weekly video that tracks market prices for fresh produce.

During the past few weeks, Limpopo saw extreme instances of frost, which caused damage to crops including spinach, tomatoes, and peppers.

Spinach was the worst affected vegetable among those tracked by AMT over the past week, with the price rocketing 27% to R5.13 per kilogram.

The price of tomatoes, which had begun to stabilise from recent highs caused by excessive rainfall that damaged crops earlier this year, shot up by more than 20% week on week. It’s still much lower than it was in April when it reached R19.52 per kilogram.

“The latest tomato price increased by 23% to R8.09 per kilogram with the cold weather resulting in volumes to decrease on the markets,” Van Der Merwe said.

Pieter van Zyl, regular market analyst for AMT, said the full impact of the recent frost damage in Limpopo is yet to be felt.

Other vegetables that have been seeing price spikes are baby marrows, green beans, chilies, and okra, Sebake said.

5. SARS traces more VBS money:

SARS’s Criminal and Illicit Economic Activities division traced stolen VBS money through two front companies into EFF deputy leader Floyd Shivambu’s FNB Private Wealth bank account. Shivambu’s sustained charade of ‘fighting for the poor’ instead of robbing them is, for the first time, highlighted by a state institution in open court proceedings following the taxman’s investigation into his brother, Brian, and the missing VBS millions.

The South African Revenue Service (SARS) has slapped two companies Brian Shivambu is the sole owner of with a R28.2-million tax bill. This eye-watering amount includes penalties because Shivambu attempted to evade paying tax for the periods 2017, 2018 and 2019.

Shivambu “defrauded” VBS Mutual Bank out of about R16-million, SARS auditors and investigators found. He “committed a criminal offence” by not declaring this as income tax and VAT – conduct which is regarded as “intentional tax evasion” – and, when contacted by SARS auditors and investigators, acted in an “obstructive” manner and ignored most of their communications and requests.

Being dismissive of SARS, of course, compounded his problems. Shivambu’s conduct earned his companies 125% and 200% tax penalties, respectively. SARS further found the companies hopelessly insolvent and brought two liquidation applications against Sgameka Projects and Grand Azania, filed at the High Court in Pretoria in July.

Grand Azania and Sgameka Projects, SARS told the court, “have been utilised by its director and only shareholder, Brian Shivambu, as the vehicles through which he defrauded the VBS Mutual Bank of approximately R16-million”.

These open court procedures include reams of tax assessments and bank statements in support of SARS’ extensive investigation – including six months’ worth of bank statements from EFF deputy leader Floyd Shivambu’s FNB Private Wealth bank account, dated 25 May to 24 November 2017.

There were no legitimate reasons for any of the cash and “loans” flowing from VBS Mutual Bank, SARS’s Criminal and Illicit Economic Activities division told the court. SARS further regards all of it as taxable “income”.

All information sourced from articles posted by: BusinessTech, TimesLive, Moneyweb, Business Insider, and Daily Maverick.

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