News in South Africa 3rd February:
1. Calls for transparency with vaccine tenders:
The Standing Committee on Public Accounts (Scopa) has sent a letter to the ministers of health and finance calling for open tender processes for the storage and distribution of the Covid-19 vaccine.
The committee has requested the two ministers in the letter to ensure that there is a transparent public adjudication of the tender processes, noting that government was already dealing with a number of companies that registered for the first time on the eve of the vaccine rollout.
“Ordinarily, these processes are undertaken in offices behind the scene, closed-door kind of arrangements where the public or any of us are not there to monitor and hear the discussions that take place. And that is what precisely gives rise to the kind of corruption we have seen because ultimately the assessment and scoring is at the discretion of panels and it has happened with the PPEs” stated by Mkhuleko Hlengwa, Chairperson of Parliament’s standing committee on public accounts.
Furthermore, the committee calls upon the executive to ensure that all normal tender processes are adhered to according to Note 3 of the National Treasury Regulations and the Public Finance Management Act.
2. Curro headline profits down:
In a trading update, Curro warned that its headline profit for the year to end-December will be down by between 35.2% to 43.5%.
The private school education company was hit hard by the pandemic and lockdown, not only as its schools had to close for many months – but also as the economic contraction hit parents’ ability to afford its fees.
In the second half of the year in 2020, the number of learners in its schools shrank by 4.1%.
Curro is currently finalising its financial results for the year ended 31 December 2020. These results will be published on or about Wednesday, 17 March 2021 due to certain logistical challenges brought about by the latest national lockdown. A webcast of the results presentation is scheduled for 10:30 on Wednesday, 17 March 2021.
3. Tourism industry struggling:
South African tourism authorities say that, despite lockdown regulations being eased, the sector still faces a host of problems – adding that the back-and-forth of having the industry locked down, then opened, then locked down again, is killing businesses.
The first thing that needs to happen in the South African tourism industry, is for it to address the current narrative overseas about there being “a South African variant” of the coronavirus, according to Tshifhiwa Tshivhengwa, CEO of the Tourism Business Council of SA (TBCSA), which represents the private sector.
“It is a Covid-19 variant and we as South Africans are not doing ourselves any favours by saying it is a ‘South African’ variant. There are many variants. There are people with that variant in the US who never even travelled to SA. So, it is a [Covid-19] variant and not a South African variant,” said Tshivhengwa.
For Sisa Ntshona, CEO of SA Tourism, the easing of regulations is a welcome step in the context of the current low tourism environment.
“In these circumstances, any form of easing helps the different value chains of tourism to operate. More importantly, it shows us that if the numbers of infections go up, restrictions will go up and vice versa, so we have to keep a close eye on the numbers as it will dictate what will happen,” says Ntshona.
“Making lockdown restrictions tighter is a blunt instrument and the only one available, but once a vaccine is rolled out and SA achieves herd immunity, then the country will be less reliant on the lockdown and more on the impact of the vaccine.”
Any form of easing up and enabling the tourism industry to trade is welcome, but it is not enough, he cautions. The whole world was set back decades in terms of travelling.
4. Ford to invest R15.8b in SA:
Ford is investing $1.05 billion (R15.8 billion) in its South African manufacturing operations in Tshwane. With this investment, Ford’s Silverton Assembly Plant is expected to generate revenues exceeding 1.1% of SA’s GDP.
The plant will be able to produce 200,000 vehicles a year. The plant will produce the all-new Ford Ranger pickup trucks, as well as the Volkswagen Amarok trucks as part of the Ford-VW strategic alliance.
The Silverton plant’s annual installed capacity will increase to 200 000 vehicles from 168 000, supporting the production of the all-new Ford Ranger pickup truck for the domestic market and export to over 100 global markets.
The expanded production will help create 1200 incremental Ford jobs in South Africa, increasing the local workforce to 5500 employees, and adding an estimated 10 000 new jobs across Ford’s local supplier network, bringing the total to 60 000, the US carmaker said.
The overall investment includes R10.3-billion for extensive upgrades to the Silverton Assembly Plant that will increase production volume and drive significant improvements in production efficiency and vehicle quality, according to the carmaker.
5. Distell revenue back at 2019 figures:
Although Distell – producer of Amarula, Savanna, Hunter’s Dry, Durbanville Hills and Nederburg – lost 41 trading days due to alcohol sales restrictions in South Africa in the six months to end-December, its revenue from the country was basically unchanged from the same period in 2019.
The company says customers opted for “spirits and mainstream wine, driven by in-home consumption and stockpiling in fear of unexpected alcohol bans in South Africa”.
In the rest of Africa, the company saw a 20% rise in revenue, with sales in Nigeria up 23%. Its overseas business saw 15% revenue growth, with Amarula delivering strong volume growth.