BUSINESS UNITY SA (BUSA) STATEMENT ON ESKOM IMPLEMENTATION OF STAGE 6 LOADSHEDDING

Business Unity SA (BUSA) notes with grave concern the announcement by Eskom that stage 6 loadshedding will be implemented from 16:00 to 22:00 today, followed by stage 4 loadshedding from 22:00 pm to midnight and stage 2 loadshedding from midnight onwards. The implementation of stage 6 loadshedding is a serious blow to an economy that is already struggling with low growth and a lack of decisive action on the part of government to make the necessary interventions to attract investment and put the country on a sustainable and inclusive growth path.

The implementation of stage 6 loadshedding will be a serious blow to all sectors of the economy and could lead to small and medium businesses buckling under the pressure of managing an untenable situation. We must stress that while this is a serious and negative impact on the economy, we are, unfortunately, not surprised that we have reached this crisis situation. We have been urging the government for numerous years to remove all barriers to private sector intervention in the generation of energy and power, but it is only recently that government has heeded these considerations. We welcome the number of embedded energy projects that have been authorised by NERSA and progress on the current bid window for renewables, but these now must be the norm rather than the exception!

We also are very concerned about the unprotected wage strike that is in progress. There are reports of intimidation of workers not participating in the strike. This must be condemned in the strongest terms if it is indeed the case. We call on unions to conduct wage negotiations through recognised channels and do so in a way that does not disrupt economic activity and cause hardship to citizens!

We now urge government to do whatever is necessary to enable Eskom to move away  from high levels of loadshedding as a matter of urgency, to deal decisively with reported acts of sabotage at Eskom by enabling law and order agencies to act with urgency to bring those responsible for such sabotage to book and to remove any remaining barriers to private sector generation of power and getting renewables onto the grid as quickly as possible.

We remain committed to working with government in providing capacity and expertise to alleviate what is now a serious crisis for citizens and the economy

 

ENDS

Cas Coovadia

Business Unity SA CEO

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSA STATEMENT ON HANDING OVER OF FINAL PART OF THE JUDICIAL COMMISSION OF INQUIRY INTO ALLEGATIONS OF STATE CAPTURE, CORRUPTION AND FRAUD IN THE PUBLIC SECTOR (STATE CAPTURE REPORT)

Chief Justice Raymond Zondo handed over the final parts of the State Capture Report to President Cyril Ramaphosa on the 22nd of June 2022. Chief Justice Zondo indicated, at the handover, that these final parts deal with, amongst others, the evidence given by President Ramaphosa to the Commission (in his capacities as President of the country and President of the ANC), the State Security Agency, the Waterkloof landing, money flows, parliamentary oversight.

 

The handover of the final parts of the report marks almost 4 years of work by the Zondo Commission and about 3 years of public hearings where extensive and detailed evidence was led by people implicated in state capture and those identified as fighting state capture. These 3 years have laid bare the depth and breadth of state capture and corruption, in both the public sector and amongst those in the private sector that are alleged to have collaborated with public officials.

 

The last parts of the Report are handed over at a time when the country faces challenges on a broad front. These include ongoing lack of economic growth, high unemployment, poverty, inequality, political uncertainty in the run-up to the ANC elective conference in December and the national elections in 2024. We also must note the ongoing process to consider the allegations against President Ramaphosa, termed the “Phala Phala” issue. We believe the report must be considered within this context and we must look at how the lessons learnt can help our country address lascivious of growth and improving the lives of our people.

 

We will study these final parts of the report and identify areas where BUSA should respond in different ways. We have previously indicated the reports of the Commission are a watershed for our country and also provides an opportunity for the private sector to introspect, learn lessons and ensure businesses operate in a sustainable and ethical manner in undertaking their businesses. We will, in the next few weeks, look at the all the sections of the totality of the reports and decide on appropriate responses, both to the content of the report and on appropriate interventions by business.

 

ENDS

Cas Coovadia

Business Unity SA CEO

_____________________________________________________________________

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSINESS UNITY SA (BUSA) STATEMENT ON BLOCKAGE ON N3 AND RELATED DISRUPTIONS

Business Unity SA (BUSA) notes with serious concern the blockage on the N3 by truck drivers and reports of disruptions on some of the alternative routes between Johannesburg and Durban. This is a recurring occurrence and BUSA has consistently appealed to government to take proactive measures to stop such blockages and arrest those that are responsible.

It is very clear that our appeals have not been heeded and there appears to be no accountability in government for this and we do not see any consequences for those perpetrating these acts. The economic impact of such blockages is obvious, given that the N3 is a critical arterial for the transport of essential and strategic good between Johannesburg and Durban, and to areas like Richards Bay.

We despair at the silence from the Minister of Transport about this significant disruption of economic activity, at a time when the country needs to instil confidence amongst investors and put SA onto a sustainable growth path. We consider this continued disruption of economic activity a crisis and ask the President to intervene to ensure appropriate resources are mobilised to pre-empt these disruptions and to clear up the current blockage urgently. We will seek a meeting with the President to raise our concerns and to get a commitment that this matter will be given the urgent attention it requires.

 

ENDS

Cas Coovadia

Business Unity SA CEO

_________________________________________________________________________

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSINESS UNITY SA (BUSA) STATEMENT ON NERSA PERMITTING OF 16 NEW RENEWABLE ENERGY PROJECTS  

BUSA welcomes recent developments regarding NERSA registering new generation facilities, which use the licence exemptions for generators under 100MW.

The fact that registration processes for the sixteen new generation facilities were processed within 19 days is very encouraging for businesses ready to generate energy and is an indication that Business engagements with NERSA are bearing results. It has been a long time coming since the announcement by President Ramaphosa that the licencing exemption threshold under schedule two of the ERA is lifted to 100MW. This amendment goes a long way to unlocking embedded generation contributing to the security of supply, attracting investment, and generating growth.

BUSA believes that upwards of 16000 direct jobs can be created (based on a 50MW threshold). Job creation is more significant under the 100MW programme. We are confident that the economies of scale unlocked by 100MW provide much-needed investment, job creation and development of local industrial capacity.

While this change is well received, BUSA believes every day of delay and load shedding adds to our economic pressures and urges the regulator to publish circulars that unpack the process for engaging in the 100MW programme from application to registration, increasing sector regulatory certainty and confidence.

We welcome the flexibility demonstrated by and determination displayed by Operation Vulindlela in this area. This is a development that should have been underway some time ago. Still, the announcement of the new generation facilities by NERSA is, we hope, the beginning of a trend where NERSA will enable the unblocking of numerous blockages that, if unlocked, significantly increase confidence, attract investment, and contribute to economic growth!

 

ENDS

Cas Coovadia

Business Unity SA CEO

________________________________________________________________________

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSA STATEMENT ON THE ARREST OF CRITICAL PLAYERS ALLEGEDLY INVOLVED IN STATE CAPTURE AND SA S&P GLOBAL RATING UPGRADE

BUSA welcomes the arrest of critical players allegedly involved in state capture, as detailed in the Report of the Zondo Commission. We called, immediately after the release of Part 1 of the report, that the state must move swiftly to implement the recommendations of the Zondo Commission. These arrests are a manifestation of a welcome urgency on the part of the government to act against those mentioned in the report. We trust the NPA has developed strong cases against those arrested and they will be prosecuted as soon as possible.

 

We also welcome the announcement by S & P Global that they have upgraded SA from a negative to a positive sovereign rating outlook, although still leaving the SA grading in sub-investment grade status. This is evidence that rating agencies will recognise positive interventions by government that begin to address the serious structural issues in the economy.

We must focus on critical issues and united to address them. Our next step is to attract investment, grow our economy, and create sustainable jobs. It is the only way to solve the severe socio-economic problems facing our country

 

We trust government will also recognise this and move swiftly to implement critical structural reforms, so that we attract significant investments and get our economy onto a sustainable path to inclusive and sustainable growth.

 

ENDS

Cas Coovadia

Business Unity SA CEO

_________________________________________________________________________

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSINESS UNITY SA (BUSA) STATEMENT ON OPERATION VULINDLELA’S PROGRESS

Business has taken note of the report from Operation Vulindlela on the progress made in implementing some of the structural reforms required to attract investment and put our country on a path to sustained and inclusive economic growth. Business has supported the work of Operation Vulindlela, and we consider this to be a successful bilateral arrangement between government and business to enable progress and implementation. We believe Operation Vulindlela has done excellent work  we note the reforms marked as “completed” and also note the excellent work done by Operation Vulindlela in this.

 

However, Operation Vulindlela is not mandated to ensure different departments in government use the reforms to implement necessary actions to enable the private sector to drive business through this. An example is the embedded generation ceiling. We welcomed the announcement by President Ramaphosa of the raising of the ceiling to 100MW. However, private sector generators of power are still being hampered by inappropriate processes and regulations in NERSA, which make it difficult to act on the reform. We find similar issues with the Critical Skills List and other reforms.

 

The issue is thus the capability and commitment of government departments to clear red tape hampering business leveraging off the reforms.

 

BUSA is in discussion with government on how we can help unblock implementation and cutting red tape to attract investment, grow our economy, and create sustainable jobs. Our country’s severe socio-economic problems can only be solved this way! The business is eager to work with the government as a reliable and trustworthy partner!

 

ENDS

Cas Coovadia

Business Unity SA CEO

_________________________________________________________________________

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSA’S REACTION TO PRESIDENT CYRIL RAMAPHOSA’S ADDRESS.

BUSA welcomes the repeal of the State of Disaster regulations, thus ending the State of Disaster that was declared 750 days ago. We believe the declaration of a State of Disaster at the advent of Covid-19 in our country was the right decision and has, by and large, had a positive impact on our ability to manage the impact of the pandemic on lives and livelihoods!

The lifting of the State of Disaster and the passing of the 30-day transition period gives SA the opportunity to accelerate our efforts to grow our economy in a sustainable and inclusive manner, thus creating much-needed jobs. We now urge government to demonstrate courageous leadership in taking the tough decisions to attract investment and work with business and other social partners to grow our economy. We galvanized ourselves as a country,  as all sectors of society, to collaborate to beat the pandemic!

We focused on a critical issue and united to address it. We must now do the same to attract investment,  grow our economy and create sustainable jobs. This is the only way to deal with the severe socio-economic problems our country faces! Business stands ready to work with government as a credible and robust partner!

We must also join the President in emphasizing the imperative to continue vaccinating all of our people! The virus is still with us, and vaccination remains our best weapon against it!

 

ENDS

Cas Coovadia

Business Unity SA CEO

_________________________________________________________________________

For More information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSA’S REACTION TO PRESIDENT CYRIL RAMAPHOSA’S ADDRESS LAST NIGHT

BUSA welcomes the ongoing downward  trend in Covid infections and the advice of the health experts to the President to lighten some of the restrictions. We particularly welcome the lifting of requirements for a PCR test for incoming visitors and returning South Africans  provided proof of a valid vaccination is provided. This will be a significant boost to Tourism and will also make it easier for vaccinated South Africans to travel. We welcome the regulations allowing 50% of capacity for outdoor events, which will enable sports events to start, but with proof of vaccination or negative test.

 

The President’s address brought the country good news, which we all need. However, the address also emphasised the imperative of not letting our guards down. We are not out of the pandemic yet! We must continue to, and increase our efforts to, encourage everybody to vaccinate! The science is unequivocal that vaccinated people have a substantially reduced risk to infection and infecting others. It is also evident that unvaccinated people are at greater risk to getting very ill if infected and being hospitalized.  So, please vaccinate!”

 

ENDS

 

Cas Coovadia

Business Unity SA CEO

_________________________________________________________________________

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

BUSINESS UNITY SA (BUSA) STATEMENT ON RUSSIAN INVASION OF UKRAINE

We are gravely concerned about the situation in Ukraine and the impact of the Russian invasion. First and foremost, we empathise and stand in solidarity with the people of Ukraine and the hardship imposed on them by this unnecessary war. Significant numbers of people find themselves leaving their belongings behind and seeking refuge in neighbouring countries, with their lives severely disrupted overnight. We are also concerned about people from other countries living in Ukraine and trying to seek asylum in Poland, Hungary, and other countries, particularly news that people of colour being refused entry to such countries. We call on all countries providing asylum to do so in a manner that does not discriminate on the basis of race.

For now, the direct economic impact on SA is minimal. Our trade with Russia is negligible, making up less than 0.4% of total merchandise exports in 2021. South Africa imported goods worth R9.2 billion from Russia in 2021, less than 1% (0.7%) of total imports. Our trade linkages with Ukraine are also negligible. This is according to research by the Bureau for Economic Research, which also identifies risk for SA if the conflict continues, particularly with gas and fuel prices,  and increased cost on freight movement and logistics costs, all of which will have knock on inflationary and interest rate impacts. There is also severe risk on agricultural exports. In 2020, we exported over US$245 000 000 (~R3,7 billion) worth of agricultural products, with citrus and apples & pears making up nearly 90% of those exports. In total, SA exports more than 7% of its total citrus crop to Russia, and more than 12% of its apples and pears exports.

 

However, we are deeply concerned that without a speedy resolution, the impact of this invasion may be considerable, with uncontrollable outcomes. At a minimum, it is causing global uncertainty just as the world is starting to recover from the impact of the Covid-19 pandemic. Indeed, the potential impact of the invasion will be felt more severely by emerging markets, like SA, and could further erode confidence in such markets and make even more difficult our efforts to rebuild our economy after Covid.

The world cannot afford conflagrations and invasions of this sort. It is critical that as countries we engage on trade and other issues globally in an environment of peace and positivity, which are pre-requisites for building an inclusive and stable global economy.

 

ENDS

Cas Coovadia

Business Unity SA CEO

_________________________________________________________________________

For more information, please contact:

Sizwe Maswanganye

Tel: 011 784 8000

Email: sizwe.maswanganye@busa.org.za

Joint statement on the need for a new framework for EU African trade relations

This week, leaders from the European Union and African Union will meet at the 6th EU-AU summit. The
Confederation of Swedish Enterprise (SN) and Business Unity South Africa (BUSA) hopes that leaders
will use the summit to discuss concrete ideas on how to step up economic relations. There is vast
potential for increased trade between the EU and Africa, and we advocate for a long-term vision that
goes hand-in-hand with ambitious negotiations and projects that are grounded in today’s challenges.

EU-Africa trade today
The EU-Africa trade relationship remains unbalanced. For Africa, the EU is by far its most important
trading partner: some 36% of Africa’s external trade in goods in 2020 was with the EU, while African
Union countries trade more with the EU than they do between themselves.

For the EU, however, in 2020 only about 5% of its exports of goods – and 6% of its imports – were with
African countries. EU-members mostly trade within their internal market and, for example, Sweden’s
extra-EU exports to Africa in 2020 constituted only 1.3% of all its exports of goods.

In other words, the room for improvement and shared growth is substantial. There is also ample room
for moving up the value chain. Although the share of manufactured goods in EU imports from Africa had
risen to 37% in 2020, most countries in Africa rely almost entirely on exports of primary products.
Trade policy alone will not be able to fulfil this unexploited potential. It will take investments in sustainable
infrastructure, ambitious and inclusive education programmes as well as fighting corruption, wherever it
is prevalent. However, both EU and African businesses would gain considerably from a more ambitious
trade policy framework.

Three steps to strengthen trade between the EU and Africa

The current trade policy relationship between the EU and the African continent is overly fragmented.
This is partially based on unilateral preferences in the GSP, and partially on the more reciprocal model
in the Economic Partnership Agreements (EPAs). Negotiating, and effectively implementing, these
agreements have proven to be time-consuming processes.

Perhaps the time has come to consider a new route, one that ambitiously includes Africa as a whole in
order to ultimately reduce fragmentation and set up a strong basis for a sustainable trade relationship.
To achieve this goal, there are three things that need to be done:

First, give serious consideration to negotiating an EU-AU trade agreement. This is a considerable
challenge, but it is also one that would be worth the effort, as it would ensure homogenous and reciprocal
market access for businesses on both continents. The aim should be to end discrimination of EU and
African companies, services, and products in each other’s markets. A starting point for this could be the
implementation of the African Continental Free Trade Area (AfCFTA).

In the long run, we expect the AfCFTA to enable:

▪ The elimination of tariffs and the facilitation of procedures at borders.
▪ The liberalization of services markets
▪ The opening up of procurement markets and improved IPR protection

However, for AfCFTA to be effective, it will require thorough implementation. Experience to date of the
EU’s EPAs and of regional African FTAs shows that thorough implementation is difficult. Therefore,
strong levers to help to ensure full implementation are needed. Technical assistance may be put to good
use in this endeavour.

Second, while preserving the gains of the EPAs, it would be more efficient to go forward with those
countries that are willing to engage individually. This depends on the state of their economy as
well as their administrative ability and political willingness to engage with the EU. However, such
efforts must not undermine the process of African integration. Rather, it should inspire and
complement African integration. EU agreements with African countries that contain provisions on
transparency, competition and efficiency can spur intra-African integration.

In particular, we advocate for:

▪ Updating the economic relationship between South Africa and the EU (beyond the present SADC EPA).
▪ Restarting the stalled FTA negotiations between the EU, Morocco, and Tunisia.
▪ Exploring willingness for non-traditional agreements – for example in the digital sphere or environmental
goods – with open-minded countries such as Ghana, Kenya, Côte d’Ivoire, Senegal, and Rwanda.
Third, there are ample opportunities to achieve more, even without the need to negotiate new
formal agreements. Many issues that African firms face in accessing the EU market relate to a lack of
capacity, given high EU standards. As for EU firms’ problems in Africa, they often face their own
troubles created by a lack of policy implementation and high levels of corruption. Much can be done to
facilitate trade within the already existing trade policy framework.

In particular, we would recommend:

▪ Providing better economic and regulatory support to African partners, and African companies, wishing
to expand into the EU market.
▪ Encouraging EU delegations in African countries to take a more active position in addressing trade
barriers and administrative inertia. They should also assist European firms active in the relevant
countries to facilitate trade.
▪ Identifying opportunities for alliances between African companies and EU companies to set up
successful supply chains.

Aiming for a sustainable trade relationship, now and in the future

All three tracks should be developed while bearing an overarching sustainability agenda in mind. The
aim should be to open up new trading opportunities in a way that helps support social, environmental
and economic development.

The Paris Agreement should lie at the heart of this strategy. Growth in Africa has a unique opportunity
to develop in a green and more sustainable way and to not reproduce the mistakes of Europe.

At the same time, EU firms have the technology and know-how needed for this to happen in Africa, and
many African firms could – based on the continents’ resources – build successful businesses aimed at
exporting sustainable goods and services to the EU.

In the short, medium and long term, EU and African countries should work together on creating a stable
framework for prosperous and sustainable trade, one which enables firms on both continents to engage
in mutually beneficial economic exchange.

 

Ends