Blog – EOSA

Anti-business, Anti-poor, Black economic empowerment (BEE), ECONOMIC GROWTH/ANTI-GROWTH FACTORS, Job creation and unemployment, Municipal governance

Decayed economic infrastructure: the Achilles’ Heel of the ANC Government?

Johannes Wessels

As Eskom struggles each day against the odds to keep electricity flowing, readers of on-line publications are treated to a multitude of articles on the SA government’s most effective achievement: the destruction of the country’s economic infrastructure.

A compendium of recent achievements includes:

Potholes in South Africa increased from 15 million to 25 million in 5 years.

Johannesburg, the economic powerhouse of the country, experience a water crisis: some suburbs were for up to 3 weeks without water supply and the sound of slowly filling toilet cisterns has become a source of joy and celebration. This despite the Vaal Dam being 90% full and the Sterkfontein Dam that feeds Vaal Dam at full capacity.

Eskom’s proven unreliability continues with power interruptions due to unplanned maintenance at ageing coal-fired stations, less than capacity generation at the vastly overpriced Medupi and Kusile power stations, as well as insufficient diesel supplies to run the emergency generators.

Coal exports through the privately developed and owned Richard’s Bay Coal Terminal (RBCT) was in 2021 a mere 58.7 million tons, the lowest since 1996 and far below the design capacity of 91 million tons. The constraints were due to cable theft and the poorly maintained rail tracks of Transnet that resulted in mined coal not reaching the export terminal despite a massive international demand.

Despite South African ports efficiency far below the global average and constantly declining, the National Port Authority’s latest report indicate it was unable to implement essential capital expenditure projects, spending less than 50% of the R39.8 billion destined for port improvements.

Several of Durban’s previously famous blue flag beaches have been turned into salty sewerage soiled stretches and untreated sewage still flow into the Vaal Dam at Deneysville.

Local authorities not maintaining their water distribution networks have lost water to the value of R9.82 billion in a single financial year.

The collapse of PRASA’s passenger rail services around the country.

Like a Moses pleading with Pharaoh…

The demise of our economic infrastructure has been long in the making. There were numerous technical reports and warnings by professional bodies and experts that under investment in infrastructure and insufficient maintenance would result in too little electricity generating capacity, heavily polluted rivers and major constraints in logistics.

The SA Institute for Civil Engineering (SAICE) warned in 2006 in their Infrastructure Report Card (IRC) that “whilst South Africa’s built environment infrastructure is very good, even world class in places, the relatively poor overall grade reflects extensive maintenance and refurbishment backlogs, caused primarily by funding and skills shortages.” The following SAICE IRCs of 2011 and 2017 conveyed the same message, but the tone got shriller: “the below average grade reflects the continuing low maintenance levels and even neglect in many areas. A lack of commitment to long term planning, adequate dedicated funding, proper management systems, data collection and skill deployment are major contributing factors…”

The government and senior officials, however, turned a deaf ear again. But this can be their Achilles’ Heel.

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Anti-business, Colonialism, Culture and development, ECONOMIC GROWTH/ANTI-GROWTH FACTORS, Indigenous self sufficiency, Slavery

Climate Change: The Trinity of Animism, Woke & the Holy Geo-spirit vs. the Western Satan

Johannes Wessels

Listening to an enthusiastic introduction of acclaimed author Amitav Ghosh’s latest book, a crucial question came to mind: How do (and should) we read books? Are our brains clean canvasses for authors to fill with colours and the medium of their word brush, or do we read through filters of our accumulated insights, always full of prejudices and opinions, ranging from mellow to stringent.

Ghosh leads an unmitigated onslaught on Western culture, economic development, rational analysis and even systematic theorising and science. He becomes the Matthew, Mark and Luke gospel writer for animism and vitalism, with Gaia, the Greek goddess of the Earth, and the Paradise of Indigenous Harmony his inspiration.

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Anti-business, Black economic empowerment (BEE), Black-owned businesses, Central planning, Corruption, Crime against business, Developmental state, Economic freedom, ECONOMIC GROWTH/ANTI-GROWTH FACTORS, Inequality, Job creation and unemployment, Lockdown, Market economy, Preferential procurement, Small and medium enterprises (SMEs), Small, medium and micro-sized enterprises (SMMEs), State Owned Enterprises (SOEs)

CR’s mask fell off: lives are less important than empowerment

Johannes Wessels
@johannesEOSA1

There is an increasingly high risk that South Africa will not by 2025 have recovered to its pre-lockdown levels of GDP. In a research report – Vaccines and re-opening: Covid-19 risks to the 2021 recovery – HSBC, one of the largest banks in the world, indicates that South Africa will not recover as quickly as most of the emerging markets.

HSBC places South Africa in a cluster of countries that will not by end 2022 regain their pre-Covid GDP levels. This list also includes France, Italy, Spain, the UK, Mexico and Argentina. According to HSBC’s estimates the rest of the Eurozone will have recovered by end 2022, with Germany reaching that target by the first quarter of 2022.

SA on the bus to Argentina

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Anti-business, Central planning, Competitiveness, Corruption, Credit risk ratings, ECONOMIC GROWTH/ANTI-GROWTH FACTORS, Economic Reconstruction and Recovery Plan, Expropriation without compensation, Job creation and unemployment, Land ownership, Lockdown, Municipal efficiency, Public service delivery

Neither Red Riding Hood, nor Tito Mboweni believes CR’s statements

Johannes Wessels
@johannesEOSA1

The statements of the government and the ANC are as unrealistic as the famous stories of Baron von Münchausen: both are so far from reality that they belong to the genre of heroic fantasy. However, the differences are also glaring. Von Münchausen’s tales are creative untruths, entertaining its hearers because of the skilful transition from reality to absurdity. The ANC’s untruths are serious policy statements, parading absurdity as real truth.

Whereas Von Münchausen’s tales emanate from a witty brain, the ANC’s tales emerge from an institutionally entrenched delusional disorder.

The very first paragraphs of the January 8 declaration suggested the following reality:

“The January 8th Statement… gives inspiration and encouragement…

“The people of this country have entrusted the ANC with the responsibility to… building a better life for all. Over the course of its history, the ANC has lived up to this responsibility.

“In government, the ANC led the reconstruction of our society from the ashes of apartheid misrule.

“Prior to the onset of the global financial crisis, our policies contributed to the revival of our economy, the creation of millions of new jobs, the stabilisation of our public finances and the reduction of poverty.

“(T)hese achievements earned the ANC the confidence and trust of the South African people.”

Really?

JSE’s head of equities voices his despair

The ANC has lived up to the responsibility of a better life for all: not even Red Riding Hood will believe that.
The government has stabilised public finances! Not even Tito Mboweni believes that (and if he does, Fitch, S&P and Moodeys don’t).

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Anti-business, Black economic empowerment (BEE), Buying local, Company tax, Competitiveness, Developmental state, Economic freedom, ECONOMIC GROWTH/ANTI-GROWTH FACTORS, Economic Reconstruction and Recovery Plan, Enterprise friendly environment, Enterprise profitability, Entrepreneurial space, Export-led growth, Expropriation without compensation, Informal businesses, Job creation and unemployment, Large enterprises, Medium sized enterprises, Preferential procurement, Property rights, Registered companies / Incorporated businesses, Small and medium enterprises (SMEs), Small enterprises, Small, medium and micro-sized enterprises (SMMEs), SME, State Owned Enterprises (SOEs), White monopoly capital theory

Loan guarantee scheme overwhelmingly inadequate: cut VAT & CIT to help SMEs

Johannes Wessels
@johannesEOSA1

The centrepiece of the Ramaphosa government’s recovery and economic resuscitation scheme – the loan guarantee fund – is as helpful as giving a desperately hungry infant a dummy, pretending it is food. Not even 5% of formal registered businesses have applied for funding and by end November about 1.8% of these firms have obtained assistance from the scheme.

It is far more affordable to cut Company Income Tax and to raise the VAT threshold to get the economy growing again, than to continue with the current package of the Economic

Why the low interest in the Loan guarantee fund?

On the one hand the enterprise world was pre-lockdown already coping with difficult conditions due to an unfriendly enterprise environment with a president that is on record that he disagreed “with the view that the most effective and efficient way to provide services to our people is through the private sector.” Many business owners, especially in the case of SMEs, are reluctant to take on more debt in such circumstances, especially when running also the risk that their properties may be confiscated (expropriation without compensation).

On the other hand, the government, being out of pocket and not keen on disbursing billions that it would lose if the beneficiaries cannot service the loans, had asked the banks to apply their own existing loan assessment criteria when evaluating the applications. Were it a Khula or a SEFA process, the money would long ago have disappeared. So, despite utterances of concern about the low and slow disbursement process, the president cannot be surprised or concerned that the banks are circumspect.

In May already, EOSA had spelt out the devastating impact of lockdown measures on the enterprise world , arguing that the systemic damage caused to the spontaneous order of enterprises can best be ameliorated by a systemic response that would enable the spontaneous order to establish its own patterns again.

The government, however, kept its focus on basically two things:

Promoting Covid-19 to the highest pedestal of dangers, wilfully ignoring all other existing problems as well as the additional problems the lockdown strategy would create, and
Pursuing its social engineering efforts to reshape the South African economy in particular, and society at large, by limiting state relief measures to businesses complying with BEE (effectively throttling white sole proprietor businesses to death), deciding which kind of businesses are essential and which not, and pursuing anti-tobacco and prohibition agendas by bans on cigarette and alcohol sales.

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Corruption, ECONOMIC GROWTH/ANTI-GROWTH FACTORS, Job creation and unemployment, Lockdown

The SA Cabinet Stakes for the Worst Minister of the Year Cup

Johannes Wessels
@johannesEOSA1

The last-rounds-of-the-year-get-together at the local oog last Monday stimulated discussions on several topics: Covid 19, lockdown, loss of jobs, closing businesses, no sport to watch, matric exams, the Zondo commission and Ace Magashule.

It was the normal crowd: Dooswyn Dekker, Paleface Mokoena, Trevor Emmer the Second, Koos Kwadraat and several other characters that each in themselves would warrant a David Kramer song. We ended the evening with a toast to our wives whose curfews were not as strict as those introduced by the National Corruption Coordinating Committee of the Republic of the State of Disaster.

Back home, I sneaked in and decided it would be better to settle on the couch which contributed more to peace than the antics of numerous winners of the Nobel Peace Prize. I was still mulling over the last discussion about what we have missed most this year. The weeks without sales of liquor and cigarettes were brushed off with a “we never were without the goodies”. Of the things caused by the Religion of Lockdown, the shortage of key sport events and the abundance of walking around being muzzled by damn masks, were the two things that generated consensus in our group as being the worst.

I was still struggling to decide which of the two things irritate me most, when I dozed off…

The Bookmakers’ Betting Board

Suddenly I find myself at Greyville Race Course where the SA Cabinet Stakes are about to be run. The trophy – Worst Minister in a Bad Cabinet – is on display in front of the main stand. It’s the final few minutes for placing bets. Looking at the Bookmakers’ Betting Board, the favourites (jockeys in brackets) are at:

2 – 1 Burning Trucks (Fearfokol Mbalula), Disruptive Governance & a Disastrous State of Affairs (Nkosazana Dlamini-Zuma) and The-beach-is-banned-and-SAPS-can-close-businesses (Bheki Cele);
5 – 1 State Control & Umpteenth Regulations (Braampie Patel), Cutting Tender Corners (Antie Patricia);
8 – 1 Snailpace Digital Transformation (Stella Foot-in-the-mouth Ndabeni-Abrahams) and Flattening the Curve (Zweli Mkhize).

They are followed at 10 – 1 by We’re-more-productive-when-we-strike (Senzu Mchunu), We can Riot but not Write (Angie Motshekga) and Unemployment is Our Pride (Walter Nxesi).

The horses that are clearly not favourites are To Hell with the Taxpayers (Pravin Gordhan) at 33 -1, No-Abalone but Polluted Rivers (Dallas Creecy) and Forward to the Fiscal Cliff (Tito Mboweni) at 50 -1 and My Fellow South Africans aren’t all ‘Our People’ (CR) at 80 – 1.