News in South Africa 7th June:

1. Record high food prices:

Global food prices extended their rally to the highest in almost a decade, heightening concerns over bulging grocery bills as economies struggle to exit the Covid-19 crisis.

Record high food prices
Image taken by: Anna Tarazevich

A United Nations gauge of world food costs climbed for a 12th straight month in May, its longest stretch in a decade. The continued advance risks accelerating broader inflation, complicating central banks efforts to provide more stimulus.

Drought in key Brazilian growing regions is crippling crops from corn to coffee, and vegetable oil production growth has slowed in Southeast Asia. That’s boosting costs for livestock producers and risks further straining global grain stockpiles that have been depleted by soaring Chinese demand. The surge has stirred memories of 2008 and 2011, when price spikes led to food riots in more than 30 nations.

“We have very little room for any production shock. We have very little room for any unexpected surge in demand in any country,” Abdolreza Abbassian, senior economist at the UN’s Food and Agriculture Organisation, said by phone. “Any of those things could push prices up further than they are now, and then we could start getting worried.”

Food prices surge
Sourced from: Moneyweb

The prolonged gains across the staple commodities are trickling through to store shelves, with countries from Kenya to Mexico reporting higher food costs. The pain could be particularly pronounced in some of the poorest import-dependent nations, which have limited purchasing power and social safety nets as they grapple with the pandemic.

The UN’s index is treading at its highest since September 2011, with last month’s gain of 4.8% being the biggest in more than 10 years. All five components of the index rose during the month, with the advance led by pricier vegetable oils, grain and sugar.

2. We can escape loadshedding:

South Africa can produce power more reliably and at a lower cost by using renewable energy and flexible power generation, but this is held back by vested interests from black empowerment companies.

This is the view of energy expert Chris Yelland, who was commenting on what the country should do to stop load-shedding.

Speaking to eNCA, Yelland said South Africans have started to accept load-shedding as normal after 12 years of blackouts. However, it is not normal in any way.

What is particularly frustrating is that millions of South Africans suffer because of load-shedding when there are easy solutions to generate enough power.

Yelland said the world of electricity generation has changed radically over the last five years with new energy sources providing an affordable alternative to coal.

To understand what should be done, it is important to consider the energy mix which is required to meet demand.

There is variable electricity demand during the day, which can be broken up into three categories:

  • Base-load – consistent demand which accounts for most of the generation capacity.
  • Mid-merit – demand during daylight hours.
  • Peaking – high demand during the morning and evening hours.

Coal was traditionally used to meet electricity demand, but the energy mix for these different periods has now been turned on its head.

Yelland said the cheapest method is used to generate base-load power, which used to be coal and nuclear. This is no longer the case.

“In fact, coal and nuclear are now the most expensive,” Yelland said.

The cheapest form of power now is renewable energy from wind and solar. This means South Africa should be generating as much power as possible from renewable sources.

3. No more walk-ins for vaccines:

South Africans without medical aid will not be allowed to walk into a private Covid-19 vaccine site without an appointment, under a department of health policy sent to such sites on the weekend.

Instead, the uninsured must be referred to one of the smaller set of public healthcare facilities administering jabs, unless they are at least 80 years old – and then only if there aren’t too many.

Medical aid members older than 60, on the other hand, can try their luck at any of the now nearly 500 points where vaccines are being given, without an appointment.

“The NDOH [national department of health] will not pay for uninsured walk-ins to private sites,” such sites were told in a circular. “These individuals are to be referred to public sites.”

“The exception is that private sector sites are authorised to vaccinate uninsured walk-ins aged over 80 years, and to reclaim the cost from the state.”

But even then, the 80-plus group may not be more than “5% of the site’s vaccine allocation”.

There is no way for the uninsured to pay directly for a vaccine from a private site; under strict rules no money may change hands. And private sites have no discretion in who they inject, under a system designed to account for every dose of vaccine.

4. Digital justice needed:

Justice and Correctional Services Minister Ronald Lamola told Eyewitness News recent announcements about transferring some judicial services into the digital format, such as applications for trusts, were all to lessen the burden on the country’s courts.

Last year, Chief Justice Mogoeng Mogoeng decried South Africa’s antiquated courts, calling for more funding to be channeled towards taking judicial services online.

The department told Parliament recently that its records showed case backlogs stood at 53% in regional courts and 48% in district courts in March last year. Lamola said the backlogs were exacerbated by delays due to COVID-19.

“It is a huge backlog countrywide and the collaboration between ourselves, the judiciary, the prosecutors, Legal Aid South Africa… there is some progress. That burden is gradually being eased but you will always find challenges,” he said in a wide-ranging interview last week.

Lamola said there needed to be legislative amendments to ensure that a full trial could run online.

Among some of the measures being explored to deal with the backlogs was the purchase of 1,500 new laptops and other equipment for magistrates to use.

5. Nationwide strike incoming:

The South African Municipal Workers’ Union (Samwu) has threatened to embark on a nationwide strike should municipalities not meet its wage demands.

Samwu, which represents over 160,000 municipal workers across the country, has demanded a 9% increase – or R4,000 – for all workers. The South African Local Government Association (Salga) has offered a 2.8% increase.

Samwu deputy general secretary Dumisani Magagula stated that if the issue could not be concluded in the boardroom, the union would take to the streets in the interests of workers.

“Our sneakers are ready for the streets. We place on record that should the facilitator’s proposal which is expected to be issued to parties (Monday) does not address the fundamental demands put forward by our members, such a proposal will outright be rejected by our members who have given us a clear mandate for these negotiations.

“Salga wants workers to get on their knees to beg for the demands that they have put forward. We are not going to bend over backwards to Salga on the bread-and-butter issues of our members,” he said.

Economists at the Bureau of Economic Research (BER) warned that South Africa is facing an incredibly long and drawn-out period of strike threats and uncertainty due to the government’s latest austerity budget.

The group said that government has been facing an uphill battle against unions over wage hikes after budgetary constraints forced it to renege on a 2018 wage agreement, which saw public sector wages frozen in 2020.

All information sourced from articles posted by: BusinessTech, Business Insider, Moneyweb, MyBroadBand, and EWN.

Leave a comment

Your email address will not be published. Required fields are marked *