Here is how Business helped pull South Africa back from the Brink of Collapse
Actions are being taken in collaboration with the state to address important issues like crime, logistics, and energy.
SA has experienced 43 days without any load shedding, and Transnet's rail and port operations are showing signs of improvement. All going well, load shedding may be history by the end of 2025.
The collaboration between business and government, called JSOC, started 11 months ago to prevent economic collapse in SA.
Over 150 CEOs from businesses have joined an initiative focusing on energy, transport, logistics, crime, and corruption. People see these areas as the most pressing issues that we need to address.
Here are some of the milestones reached:
Energy
- Power cuts have decreased by 61% from December 2023 to February 2024 compared to the same period last year
- Stage 4 load shedding is down 80%
- Six gigawatts (GW) of new generation capacity has been added to the grid
- The investment pipeline for new power generation has doubled;
- Requests for proposals (RFPs) have been issued for 7.6GW of renewable energy, gas-to-power and battery storage
- New CEO for Eskom appointed (Dan Marokane)
- The National Transmission Company of South Africa (NTCSA) has been established, and a board put in place to unbundle and separately manage Eskom’s transmission grid
- Eskom’s energy available factor has improved above 55%
Transport and logistics
- New CEOs appointed at Transnet (Michelle Phillips) and Transnet Freight Rail (Russell Baatjies)
- 36% less waiting time to anchor vessels (as at March 2024)
- 45% fewer vessels anchored outside Durban
- National Treasury agreed to a R47 billion guarantee for Transnet, subject to conditions
- R700 million invested in important rail routes, mainly for security. Private sector helps with drones and security to prevent theft of cables and equipment.
- Transnet has released a draft 'Network Statement' to attract private investment and prepare for competition by the end of 2024.
- In 2024, the decrease in freight volumes stopped. The goal for the 2024/5 year is 193 million tones (Mt), slightly below the 200-220 Mt needed for economic recovery.
Crime and corruption
- The National Prosecuting Authority selected twenty important and complicated cases for prosecution. This is to assist South Africa in being removed from the Financial Action Task Force grey list.
- Crime call centre modernised
- NPA Amendment Bill tabled to establish the Investigating Directorate against Corruption and provide for the appointment of anti-corruption investigators
- The NPA has stopped the exodus of skills and is now restaffing.
- A plan is set to use a R56 million investment from Sabric and Basa. The plan involves establishing a forensic analysis center and providing training for complex cases.
- One important goal is to reduce infrastructure crime at Eskom and Transnet, and there are signs that progress is being made.
‘Quick results’
Businesses have been willing to help improve performance at the ports and rail operator, leading to quick results.
One solution was using drones and security to stop cable theft, which has been causing major problems for operations.
Investments in renewable energy are increasing, leading to fewer unplanned outages. 4,000MW of new power will be added in 2024, with an expected 7,000MW in 2025.
The partnership between businesses and the government has helped address the energy crisis. This partnership has created strong governance structures and good working relationships through the National Energy Crisis Committee (Necom). Necom is responsible for improving Eskom and adding new power sources to the grid. Necom is responsible for improving Eskom and adding new power sources to the grid.
To sustain the energy transition, R1.5 trillion is needed over 10 years, which is R150 billion per year. That requires unbundling Eskom and setting up a new company to manage power transmission.
We need to get our focus out of energy scarcity and load shedding to the bigger picture.
Crime reduces GDP by an estimated 5%, with knock-on impacts on tax collection and the cash economy.
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