News in South Africa 25th May:

1. Gupta looting at R50b so far:

Appearing before the Zondo Commission on Monday, investigator Paul Holden meticulously laid out the flow of money from government entities to the Guptas’ money laundering apparatus. Almost R50bn can be traced through invoices and bank statements – but, warned Holden, the true cost to the state is definitely higher.

Gupta looting at R50b so far
Image taken by: Sora Shimazaki

“Manifestly irregular.”

That was the phrase of the day at the Zondo Commission on Monday, when the inquiry into State Capture was taken through the dizzying flow of state funds into Gupta coffers via dodgy contracts.

Paul Holden, who runs the NGO Shadow World Investigations alongside former ANC MP Andrew Feinstein, made his second appearance at the commission to present the hard figures associated with the Gupta family’s capture of the South African state.

Holden read into evidence amounts running to 10 or 11 figures before the decimal point.

The amounts are, to quote commission evidence leader Matthew Chaskalson, “extraordinary”.

At points Judge Raymond Zondo appeared defeated by the sheer volume of numbers, murmuring: “I’m just digesting”.

What was on display was not just the quantum of plunder, but also the efficiency of the Guptas’ vast and sophisticated money laundering machinery.

2. Booze ban a possibility:

The Department of Health is confident that it has the capacity to deal with the third wave of Covid-19 infections, but that does not mean a potential booze ban is off the table.

The department said that it could in all likelihood cope with a rise in infections. But alcohol-related trauma cases are always something to consider when the healthcare system is put under severe strain.

This as there is a greater anticipation that President Cyril Ramaphosa will address the nation in the coming days and potentially move South Africa to a higher lockdown level due to rising Covid-19 infections.

This includes a possible ban, or curtailed sales hours, on alcohol as Covid-19 infections increase. In response, the liquor industry has actively approached President Cyril Ramaphosa for a meeting to find sustainable solutions should government impose yet another alcohol ban.

Government has thus far imposed three liquor bans throughout the the one-year State of Disaster, saying that it eased congestion in hospitals due to alcohol related trauma.

The latest wave of infections come shortly after South Africa donated scores of ventilators to India, as that country suffered a devastating wave of Covid-19 infections and deaths.

This begged the question whether this means the country has increased its own capacity to deal with the virus, and whether another booze ban would even be necessary to help ease hospital congestion.

In response, health department spokesperson Popo Maja said “realistically speaking”, they were ready to handle the third wave, but that the effects of alcohol-related trauma cases could not be underestimated.

3. Vaccinations too slow:

The South African Medical Association has raised concerns about South Africa’s capacity to vaccinate the population at the rate required to meet government targets – even with the private sector slowly coming on board.

While vaccination sites have grown in number, the number of jabs being administered is not growing – sticking to just under 40,000 a day. South Africa needs to vaccinate at least 100,000 people a day to meet the phase 2 target, and nearly double that to meet the 40 million target in early 2022.

There have been delays in the distribution of vaccines, while some sites are only now starting the second part of phase 1 vaccinations, targeting healthcare workers.

South Africa is in Phase 2 of its vaccine rollout campaign and has received over a million jabs so far.

4. Economic impact of slow vaccinations:

Ratings agencies Fitch and S&P Global have warned about the slow pace of South Africa’s Covid-19 vaccination programme.

Both agencies kept the country’s long-term sovereign credit ratings at BB- on Friday, which is three notches below investment grade. However, both also flagged the comparatively slow rate of vaccinations as a constraint or risk to medium-term economic growth.

“Infection numbers have started rising again and the pandemic will continue to pose risks well into 2022, as [the] vaccine rollout is proceeding slowly,” Fitch says in its latest rating report.

Mkhize, who has also been warning recently of the country hitting a third wave of the pandemic, noted that there are currently 40 724 active cases of Covid-19 in the country.

While Fitch has recognised that the South African government has secured enough doses to inoculate the adult population, it highlights that most of this “will arrive only in the second half of 2021”.

“We assume that the economic fall-out of any new waves will be more limited than last year, as policy-makers have containment measures [that] will be more targeted and the economy has adapted, but it could still weigh on public finances,” Fitch adds.

S&P meanwhile highlights the slow vaccine rollout as a constraint on the country’s medium-term economic growth, together with structural constraints and the weak pace of economic reforms.

5. Digital Vibes irregularities:

The health ministry has admitted that there have been some “glaring irregularities” found in the awarding of a multimillion-rand contract to Digital Vibes, a company linked to minister Dr Zweli Mkhize.

In February this year, Daily Maverick broke the story about how Digital Vibes had been appointed in 2019 through a closed tender to provide communication services for the government’s National Health Insurance (NHI) rollout, with the scope of the work extended in March 2020 to include communications services for Covid-19.

The contract, worth R82m, is being investigated by the SIU.

According to the news agency, Digital Vibes later employed Tahera Mather, a long-serving spokesperson and alleged family friend of Mkhize, as a consultant. It said the company also appointed a former assistant to the minister, Naadhira Mitha.

On Monday evening, the health department issued a statement after receiving several media queries regarding the communications contract. This after the Daily Maverick published another article about the saga.

“At this stage we can only confirm that the decision for the investigation to be conducted externally by entities with the necessary capacity was important as it has unveiled some glaring irregularities that will certainly have to be responded to [or] action taken against,” the statement read.

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

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