Jeremy’s weekly wrap

Connie Queline

Jeremy’s weekly wrap

In a recent note the Auditor-General highlighted significant governance issues at South African Airways (SAA), including poor executive oversight, flawed accounting practices, and procurement processes susceptible to corruption. Interim CEO Professor John Lamola acknowledged these concerns this week, referencing the period between April 2018 and March 2022, a turbulent time for SAA marked by financial distress and eventual business rescue.

Lamola emphasised that the criticisms pertain to the airline’s past operations, which were scrutinised during the Zondo Commission of Inquiry. Since emerging from business rescue in May 2021, SAA, he says, has embarked on a comprehensive remedial programme aimed at addressing the audit findings from 2018, indicating a commitment to reform and improve governance and operational efficiencies.

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You can also listen to this podcast on iono.fm here.

Roy Havemann, a financial sector policy and public economics principal at Krutham and part of the SA-TIED programme, addressed the challenging economic situation in South Africa, where the interest rate on national debt consistently surpasses the country’s economic growth rate. This imbalance contributes to a growing debt-to-GDP ratio, exacerbating fiscal pressures and hindering effective debt management. Havemann spoke about the detrimental cycle South Africa faces, where weak economic growth leads to insufficient revenue collection and, consequently, a rise in debt-to-GDP.

You can also listen to this podcast on iono.fm here.

At the Africa Energy Indaba in Cape Town, South Africa’s Minister of Energy and Mineral Resources, Gwede Mantashe, addressed concerns about the potential shortage of natural gas by 2026, due to Sasol’s cessation of gas supply from Mozambique. Mantashe assured that alternative plans are in place to avoid such a shortage, emphasising the country’s energy strategy as outlined in the Integrated Resource Plan (IRP) of 2019 and its updated version in 2023.

Andrew Maggs, editor of Africa Mining Watch, discussed the management of South Africa’s transition from fossil fuels to renewable energy, highlighting the success of the Renewable Independent Power Producer Programme (Reippp) and the launch of new requests for proposals under this program to procure additional generation capacity from renewables, gas, and battery energy storage. Concerns about the feasibility and sourcing of natural gas were raised, especially with the impending depletion of South Africa’s current gas supply. Discussions at the Indaba also covered funding sources for energy projects, including contributions from development funding institutions and private lenders, and the importance of creating efficient transmission infrastructure to distribute generated power.

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You can also listen to this podcast on iono.fm here.

President Ramaphosa this week highlighted the benefits of the collaborative efforts between the government and business sectors in South Africa, pointing to tangible improvements in reducing load shedding, enhancing the performance of the rail network and ports, and decreasing security incidents targeting critical infrastructure.

Martin Kingston, chair of the Business for South Africa (B4SA) steering committee, affirmed these achievements, acknowledging the time and effort it took to establish effective collaboration structures. He cited specific areas of progress such as a significant reduction in load shedding, improvements in transport and logistics efficiency, and a decrease in criminal incidents along critical network corridors. Despite these advancements, Kingston recognised the ongoing challenges and the elevated levels of frustration among businesses and individuals due to the slow pace of change.

You can also listen to this podcast on iono.fm here.

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