News in South Africa 30th July:

1. Vaccine rollout gains momentum:

South Africa’s Covid-19 vaccine rollout is gaining momentum as it opens to younger age groups. A third of the country’s total jabs have been administered in the past two weeks alone.

Vaccine rollout gains momentum
Image taken by: Frank Meriño

South Africa’s vaccination rollout got off to a shaky start due to procurement issues, with criticism levelled at government for failing to negotiate swift supply agreements with pharmaceutical companies.

And just when the rollout seemed primed to begin in February – prioritising healthcare workers in line with government’s risk-evaluated approach – it hit a serious snag. Studies showed that the Oxford/AstraZeneca vaccine, of which South Africa had already ordered 1.5 million doses from the Serum Institute of India, had a hugely decreased efficacy against the 501Y.V2 variant.

Now with J&J and Pfizer underpinning the rollout – around 30 million doses of each have been ordered – the supply chain appears steady. The department of health has promised to start vaccinating more people on the weekend, starting in August – to meet the short-term target of 300,000 doses administered per day – and the rollout is opening to younger age groups at a quicker rate than first anticipated.

Critical to the recent increase in tempo has been the health department’s updated policy to allow those registered on the Electronic Vaccination Data System (EVDS) to walk-in to receive their jabs. Sites are accepting those with and without appointments; those with medical aids and the uninsured alike.

Vaccinations opened to people aged between 50 and 59 – almost doubling the number of people eligible to be vaccinated – in early July. Two weeks later, and ahead of schedule, the rollout was opened to people in the 35 to 49 age group, representing some 11 million people.

2. Retail continues despite looting:

Recent unrest in South Africa damaged hundreds of businesses but property developers and retailers say they remain committed to the fast-growing consumer markets of its predominantly Black townships.

Riots broke out this month after former President Jacob Zuma handed himself in to start a 15-month jail term for contempt of court.

More than 300 people died and about 3,000 stores were looted, over half of them belonging to major retailers and fast food brands. At least 161 shopping malls, 11 warehouses and eight factories suffered heavy damage, sites that include tenants such as grocery chain Shoprite  and Walmart majority-owned Massmart.

The hardest hit areas included Durban’s uMlazi and Johannesburg’s Soweto and Alexandra townships in KwaZulu-Natal and the economic heartland of Gauteng.

Exemplar REITail had five of its 27 malls damaged, including three which are expected to take up to four months to return to normal operations, CEO Jason McCormick stated.

Yet McCormick said the company remained committed to not only repairs, but the development of another 30 malls in the pipeline. “What happened was tantamount to a black swan event. I don’t think anyone ever foresaw the extent of this ever happening,” McCormick said at one of the group’s malls in Johannesburg.

McCormick’s views reflected those expressed by six other CEOs and executives of listed property companies and two retailers interviewed.

Real estate developers and retailers have spent the last two decades targeting rising consumer spending by the Black middle class in areas that were disadvantaged for decades under white minority rule. For such communities, the benefits include jobs and the convenience of having shops nearby, eliminating the cost of travelling to other towns, and these developments in turn attract other retailers and services such as banks.

3. Food prices outpace inflation:

The latest Household Affordability Index by the Pietermaritzburg Economic Justice & Dignity group (PMBEJD) shows that food prices have increased marginally in July – but basket prices have outpaced inflation by some margin over the last 11 months.

The civil society initiative found that its household food basket recorded a slight increase in price month-on-month, and remains at much higher levels than September 2020, when the basket was first compiled.

The basket was tracked at R9.20 (0.2%) more expensive than a month ago (June) at R4,137.43. Over the past 11 months, the cost of the average basket price increased by 7.3% or R281. Inflation over the same period was much lower, tracking between 3% and 5%.

The basket comprises 44 core food items most frequently purchased by lower-income households who make up the majority of households in the country.

Over the last month, the price of maize meal, rice, flour, and white sugar has come down. Cooking oil prices continue to be high, and potato, onion, and butternut prices increased – as did frozen chicken portions, eggs, and most meats. Bread prices increased marginally.

Of the 44 food items tracked by the group 21 increased in price, while 18 dropped in price month-on-month. With prices remaining relatively flat between June and July, only four items saw a shift in price above 10%.

June 2021 – July 2021 big changes:

  • Potatoes: +15%
  • Carrots: -12%
  • Oranges: -17%
  • Tomatoes: -18%

Over the last 11 months, however, the picture is very different, with some items increasing by as much as 44%, and others dropping by as much as 49%. Only nine items have decreased in price since September 2020. Prices for 32 items have gone up – some quite significantly.

September 2020 – July 2021 big price changes:

  • Sugar beans: +44%
  • Gizzards: +38%
  • Cooking oil: +35%
  • Fish: +23%
  • Beef liver: +23%
  • Potatoes: +16%
  • Beef: +18%
  • Margarine: +13%
  • Chicken livers: +12%
  • Maize meal: +12%
  • Onions+12%
  • Samp: +10%
  • Frozen chicken portions: +10%
  • Green pepper: -15%
  • Oranges: -49%

4. Digital Vibes must pay back R150m:

The Special Investigative Unit wants Digital Vibes to pay back the R150 million it scored from a health department communication contract, which is said was awarded irregularly.

The unit has filed papers with the Special Tribunal, seeking to review and set aside the contract. The unit has also reportedly made adverse findings against health minister Zweli Mkhize, saying his conduct in the matter was unlawful and improper, and that his family should pay back R4 million.

Mkhize was placed on special leave over the contract after his family was found to have benefitted from his ties to Digital Vibes. Two of his close associates have been linked to the company.

5. Storage issue in Port of Durban:

The Port of Durban in KwaZulu-Natal is running short of space to store containers and plug points to keep containers cool, which will result in massive food wastage if not resolved urgently.

According to a statement by the South African Meat Processors Association (Sampa) and the South African Association of Meat Importers & Exporters (Amie SA), there are currently 290 temperature-controlled ‘reefer’ containers that require an urgent cold storage remedy, with more containers en route from international markets set to offload at the Durban port.

Sampa and Amie SA note that the recent riots and looting severely impacted key cold storage infrastructure in the province, compounded by the recent cybersecurity hack on Transnet’s IT systems, which affected its operations and created major backlogs for both exports and imports at the port.

“Now that the Durban port has resumed operations, an urgent action plan by government is required to ensure imported perishable food containers are re-routed to inland cold storage facilities.

“This is critical if South Africa wants to avoid chronic food shortages across the country, specifically for the poorest who rely on affordable chicken and meat products such as polony as their primary sources of protein,” say the two associations in a statement.

“Besides requiring an urgent solution for cold storage of containers, an additional complication lies in the micro-biological, phytosanitary testing of food product coming into the port, and the authorities’ curtailed capacity to test arriving product due to the damage to some testing labs.”

All information sourced from articles posted by: BusinessTech, Business Insider, Reuters, ENCA, and Moneyweb.

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